Financial & Legal News

Fake Furlough, Whistleblowers and Employment Laws

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Fake furlough and whistleblowing workers have hit the headlines recently and employers should make sure they operate within all employment guidelines and laws, warned specialist solicitor Susan Mayall, Head of Employment Law at Pearson.

With the furlough scheme coming to an end next month HM Revenue and Customs says it will come down hard on those firms flouting the rules and already has had over 8,000 tip-offs to its fraud hotline.

Staff have been anonymously reporting their employers for making them work whilst furloughed.

“It is important for employers to check that their payroll and claims are correct,” said Susan.

A recent major study by three universities revealed 63% of employees were working during their furlough period.  Staff say they worked an average of 15 hours a week and it was found that it was not only lower paid and lower skilled workers affected, men on higher incomes were most likely to defy the ban.

When it was introduced the furlough scheme paid 80% of employees salaries up to £2,500 a month and was seen as a lifeline for many businesses.

Law firms representing employees have been getting calls from workers seeking legal advice and stating that they have felt compelled to work during furlough to keep their jobs. Whistleblower organisations are reporting the same, according to the study.

The recent survey of almost 9,000 workers found:

  • Not working whilst furloughed was ‘routinely ignored’
  • Bosses told staff to carry on working even though it was illegal
  • Furloughed staff worked an average of 15 hours a week, with men on higher incomes the most likely to defy the ban
  • The discretionary top-up over the £2,500 salary level was paid to seven in ten workers

“The Government scheme paid the salaries of staff and the aim was to keep our economy afloat, it was specifically up until flexible furlough came in on 1st July 2020 work must NOT be carried out during furlough and that included work done at home.  The vast majority of business owners have used the CJRS responsibly, I clearly instructed all my employer clients of this and made sure everyone was kept up to date with the changing regulations,” said Susan.

“Companies cannot prevent whistleblowing and when laws are broken they will have to face the consequences and repay the money they have claimed, plus a fine and HMRC are using payroll data to investigate non-compliance.  Simple planning ahead and getting good advice on all aspect of employment law is essential at all times, but during a situation such as this is crucial.”

Tapering and flexible furlough was introduced at the end of July and employers could benefit from using staff as and when work dictated a need, although some employers could abuse it and say an employee worked one day when in fact they worked four and qualify for larger government wage subsidies.

For all aspects of employment law advice contact Susan Mayall on 0161 785 3500 or email

Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.

This blog was posted some time ago and its contents may now be out of date. For the latest legal position relating to these issues, get in touch with the author - or make an enquiry now.

Written by Susan Mayall


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