Furlough

Furlough generally means a temporary leave of absence from work. The employee remains employed with the business and on the payroll but does not work. This term has been used during the coronavirus (COVID-19) pandemic to refer to employees that have been furloughed as they cannot work because of lockdown restrictions.

The UK government has provided financial support to employers and businesses through the Coronavirus Job Retention Scheme, also known as the Furlough Scheme. This has allowed businesses that have been severely affected by the coronavirus pandemic to furlough their staff. When furloughed, an employee receives 80% of their current salary for hours not worked, up to a maximum of £2,500.

Under the more flexible second and third phases of the Furlough Scheme, employees may either stop working completely or work reduced hours while furloughed.