What can suppliers of goods and services do to minimize risk?

For those with variable pay, if the employee has been employed for a full 12 months before the period claimed for you, can take the higher of:

• The same month’s earnings in the previous year; or
• Average monthly earnings from the 2019/20 tax year.

For those who have been employed for less than one year you can use the average of their monthly earnings since they began their employment until the date they were furloughed.

If they have been employed for less than a month, work out a pro rata for their earnings so far, and claim for 80%.

On 7 May the Government published guidance on how contracting parties can act responsibly in order to assist the effort to deal with Covid-19. The guidance seeks to persuade contracting parties to act reasonably and recognise the impact of Covid-19 on contractual counterparties. This will continue to be relevant as business begins to emerge from lockdown.

From 1 July 2020 the furlough scheme has been operating more flexibly.

The key changes from 1 July 2020 were:

• All furloughed employees are subject to the new flexible furlough rules and the new basis for calculating claims
• Furloughed employees can be brought back to work on a part-time basis for any amount of time and can work any work pattern
• Employers can claim for the hours not worked compared the hours the person would normally have worked in that period
• There must be a new written furlough agreement in place to record the agreement with the furloughed employee to return to work part-time
• The new agreement (including a collective agreement) must be made before any period of flexible furlough begins but it may be varied at a later stage if necessary. The agreement must be incorporated into the employee’s contract of employment, either expressly or impliedly
• Employers must keep a record of this agreement until at least 30 June 2025, and they must also keep a record of the hours the furlough employee worked and the hours that they were furloughed
• Employees can be furloughed from 1 July 2020 for any amount of time and more than once
• However, if you re-furloughed an employee after 10 June but before 1 July 2020, they had to be furloughed for an initial period of three consecutive weeks
• Claims for payments under the scheme must not cross calendar months so if you are claiming for the initial three week period of a re-furloughed employee who was furloughed on 12 June for example, you must submit separate claims for the dates in June and July
• Although flexible furlough agreements can last any length of time, you should only submit a claim to HMRC once a week.

It is envisaged that employees of organisations falling into the first two categories set out above and won’t be eligible for the job retention scheme in relation to the majority of their employees. It is envisaged that NHS Trusts for example are going to require their staff to be working at full capacity where possible. However, the guidance doesn’t definitely exclude public sector organisations from furloughing employees and notably the government expects such organisations to use public money to continue to pay staff and not furlough them, rather than say requires. In reality, it is difficult to see how such an organisation will be able to rely on the scheme, but the guidance doesn’t completely rule it out.

Solicitors can be authorised to sign contracts for their clients – a signed letter of authority should be scanned and sent to avoid posting potentially contaminated documents.

Solicitors should exchange supplemental agreements on behalf of their clients to agree to postpone exchange and completion dates if it has been agreed to push these back.

The Law Society advises that electronic signatures be used as much as possible for contracts, to avoid possible contamination. However, the Land Registry confirms that the legal transfer document cannot be validly executed with an electronic signature. Solicitors should agree a completion undertaking that the original transfer document will be sent when received and after the restrictions have been lifted.

The Land Registry’s latest guidance https://www.gov.uk/guidance/coronavirus-covid-19-impact-on-hm-land-registrys-services published on 14 May states:

We accept deeds that have been signed using the ‘Mercury signing approach’.

For land registration purposes, a signature page will need to be signed in pen and witnessed in person (not by a video call). The signature will then need to be captured, with a scanner or a camera, to produce a PDF, JPEG or other suitable copy of the signed signature page. Each party sends a single email to their conveyancer to which is attached the final agreed copy of the document and the copy of the signed signature page.

Solicitors should be willing to adopt this procedure for completing transactions to enable them to be registered by the Land Registry.

The execution of a transfer is a deed and must be witnessed. Members of the family can witness signatures so long as they are not also a party to the document. A witness will be more credible if they are 18 or over, but this is not a legal requirement. The legal requirement is for the witness “to be present” when the document is signed. It would be possible for a witness to be on the other side of the room or the other side of a window, and validly witness the execution of a deed. The witness does need to take precautions to avoid possible contamination from the document.

A statutory declaration does not need to be witnessed but must be administered by a solicitor or commissioner for oaths. There is no legally prescribed process for this, and there is nothing to suggest that this could not be validly done via a video telephone call if the signature on the declaration can clearly be seen by the person commissioning the oath when the oath is made.