Cherry Tree

Ask the Advisor: What’s the Difference Between a Furlough and a Layoff? | Benefits Collaborative

By

Question:

What’s the difference between a furlough and a layoff?

Answer:

First, you should note that the language used when sending employees home for a period of time is less important than communicating your actual intent. Since temporary layoffs and furloughs are only used regularly in certain industries (usually seasonal), you should not assume that employees will know what they mean. Be sure to communicate your plans for the future, even if they feel quite uncertain or are only short-term.

Furlough

A furlough continues employment, but reduces scheduled hours or requires a period of unpaid leave. The thought process is that having all employees incur a bit of hardship is better than some losing their jobs completely. For example, a company may reduce hours to 20 per week for a period of time as a cost-saving measure, or they may place everyone on a two-week unpaid leave. This is typically not considered termination; however, you may still need to provide certain notices to employees about the change in the relationship, and they would likely still be eligible for unemployment.

If the entire company won’t be furloughed, but only certain employees, it is important to be able to show that staff selection is not being done for a discriminatory reason. You’ll want to document the non-discriminatory business reasons that support the decision to furlough certain employees and not others, such as those that perform essential services.

Layoff

A layoff involves terminating employment during a period when no work is available. This may be temporary or permanent. If you close down completely, but you intend to reopen in the relatively near future or have an expected reopening date—at which time you will rehire an employee, or all employees—this would be considered a temporary layoff. Temporary layoffs are appropriate for relatively short-term slowdowns or closures. A layoff is generally considered permanent if there are no plans to rehire the employee or employees because the slowdown or closure is expected to be lengthy or permanent.

Pay for Exempt Employees (those not entitled to overtime)

Exempt employees do not have to be paid if they do no work at all for an entire workweek. However, if work is not available for a partial week for an exempt employee, they must be paid their full salary for that week, regardless of the fact that they have done less work. If the point is to save money (and it usually is), it’s best to ensure that the layoff covers the company’s established 7-day workweek for exempt employees. Make it very clear to exempt employees that they should do absolutely no work during any week you’re shut down. If exempt employees do any work during that time, they will need to be paid their normal weekly salary.

Pay for Non-Exempt Employees (those entitled to overtime)

Non-exempt employees only need to be paid for actual hours worked, so single day or partial-week furloughs can be applied to them without worrying about pay implications.

We recommend that you engage in open communication with the affected employees before and during the furlough or temporary layoff period.

Originally posted on ThinkHR.com

15,715 responses to “Ask the Advisor: What’s the Difference Between a Furlough and a Layoff? | Benefits Collaborative”

  50. My brother suggested I might like this blog.
    He was entirely right. This post actually made my day.
    You can not imagine simply how much time I had spent for this info!

    Thanks!

  52. Aw, this was an extremely nice post. Taking the time and actual
    effort to produce a superb article? but what can I say?
    I procrastinate a lot and don’t manage to get nearly anything done.

    my web blog :: khoquet.com

  67. I wish to express some thanks to this writer for rescuing me from this problem.

    Just after researching through the world wide web and coming across concepts which were not productive,
    I assumed my life was done. Existing devoid of the strategies to the difficulties you’ve sorted out as a result of
    your good write-up is a crucial case, and ones which might have in a negative way damaged
    my entire career if I had not encountered your
    web site. The expertise and kindness in handling all the stuff was important.
    I’m not sure what I would’ve done if I hadn’t encountered such a stuff like this.
    I am able to at this time look ahead to my future.

    Thank you very much for this skilled and sensible guide. I won’t
    think twice to suggest your site to any person who should get guidelines
    on this topic.

    Take a look at my page … testisatu4.www25.zoner-asiakas.fi

  79. hello there and thank you for your information ?
    I’ve definitely picked up anything new from
    right here. I did however expertise several technical issues
    using this site, as I experienced to reload the website many times previous to I could get it to load correctly.

    I had been wondering if your web host is OK?

    Not that I am complaining, but sluggish loading instances times
    will sometimes affect your placement in google and could damage your quality score if advertising and marketing
    with Adwords. Well I am adding this RSS to my e-mail and can look out
    for a lot more of your respective fascinating content. Make sure you update this again soon.

    Here is my site: QuadAir Drone

  83. Asking questions are actually nice thing if you are not understanding anything fully, however this article presents good understanding yet.

  84. A fascinating discussion is definitely worth comment. I do think that you should publish more on this
    issue, it might not be a taboo matter but typically people
    do not talk about these topics. To the next! Many thanks!!

    Also visit my site Niagara XL

  93. Thank you for any other magnificent post. The place else could
    anyone get that kind of info in such a perfect way of writing?
    I’ve a presentation next week, and I’m on the search for such info.

    Also visit my web blog :: Viking XL Reviews

  116. This is the perfect blog for anyone who would like to understand this topic.
    You know a whole lot its almost tough to argue with you (not that I actually will need to?HaHa).
    You definitely put a new spin on a subject which has been written about for ages.
    Wonderful stuff, just wonderful!

    Here is my blog; Erorectin

  118. I blog frequently and I truly appreciate your content. The article has truly peaked my interest.
    I will bookmark your website and keep checking for new
    information about once a week. I subscribed to your RSS feed too.

    Feel free to surf to my site Klara

  131. Howdy! This blog post could not be written any better! Going through this post reminds me of my previous roommate!
    He constantly kept preaching about this. I will forward this article
    to him. Pretty sure he will have a good read. Thanks for sharing!

    my web page :: Primiene

  140. Thanks, I have just been looking for information about this
    topic for a while and yours is the best I’ve discovered
    so far. However, what in regards to the conclusion? Are
    you positive about the supply?

    Feel free to surf to my web-site :: Keto Body Pills

  145. I blog quite often and I truly appreciate your information. Your article has truly peaked my
    interest. I’m going to bookmark your blog and keep checking for new details about once a week.

    I subscribed to your RSS feed as well.

    Here is my blog: ACV Rx Ingredients

  205. Консультация у психолога.
    Консультация психолога Психолог в Харькове,
    консультация. Психологи онлайн.
    Психотерапия онлайн! Консультация Психолога – Профессиональная поддержка.
    Рейтинг психологов. Индивидуальный подход к
    консультированию!

  255. Приготовили для Вас восемнадцать с высоким рейтингом
    сериалов для поклонников комедий.
    Чики смотреть онлайн сериал, сезон, все серии.
    Размещайте по рейтингу IMDB, Сериалы жанра “Детектив”.
    Точно также наш проект дает перечень телеканалов Россия, HD Дом кино,
    4K Киномикс, прямой эфир Пятница, трансляция
    НТВ.

  257. У нас одинадцать новых сериалов для фанатов ужасов.
    Бумажный дом 5 сезон 7 серия смотреть онлайн все серии
    подряд, смотреть онлайн. Сортируйте по
    предпологаемой дате выхода, Сериалы жанра “Фантастика”.

    Точно также мы предоставляет палитру каналов СТС, HD Суббота, 4K FOX Россия,
    прямой эфир Пятый канал, трансляция Мир.

  1328. You’re so interesting! I don’t think I have read through something like that before. So good to find another person with unique thoughts on this subject matter. Really.. thank you for starting this up. This web site is one thing that is required on the web, someone with a little originality!|