The Department for Business, Energy & Industrial Strategy has brought in new legislation which will come into force tomorrow (31 July 2020) to ensure furloughed employees receive statutory redundancy pay based on their normal wages, rather than their reduced furlough pay.
The government has continually urged employers to do right by their employees and pay those being made redundant based on their normal wage, rather than their furlough pay; whilst the majority of businesses have done so, there are some employers who have not.
Therefore, the government will today bring in legislation to ensure all furloughed employees who are being made redundant receive their full entitlement.
Employees with more than two years’ service are entitled to statutory redundancy pay calculated based on their normal weekly pay (capped at £538), age and length of service. Some employers also offer an enhanced redundancy package and must ensure they comply with the terms of the employees’ contract if that is the case.