As the country emerges from Covid-lockdown restrictions, there’s been an increase in discussion about furlough fraud and the government’s robust approach to dealing with this.

The most common types of fraud are likely to be:

  • requiring an employee to work while on furlough.
  • an employer misrepresenting the hours an employee worked for the purposes of claiming a furlough payment.
  • an employer failing to ensure the workplace was safe when employees returned to work.

Employee making a confidential furlough fraud disclosure

Apart from the legal implications of furlough fraud, which include fines and possible imprisonment, employers may also be at risk of whistleblowing claims by employees in a tribunal, with respect to these types of furlough scheme abuses.

These claims can be made if an employee reasonably believes that something illegal has occurred, irrespective of whether it has. They also need to have raised the issue correctly.

Handling furlough fraud disclosures as an employer

If an employee raises an issue about their employer’s management and conduct in respect of the furlough scheme, this may amount to a protected disclosure.

An employee who makes a protected disclosure is protected under the law from detrimental treatment, disciplinary action, or dismissal. Any dismissal will be automatically unfair.

If a protected disclosure is made, it is essential an employer deals with it appropriately to avoid a subsequent claim being made against them in a tribunal.

Have a whistleblowing procedure in place

Employers should ensure that staff handbooks include a whistleblowing policy. It should include details of how a protected disclosure should be made.

It is important that employees are made aware of the policy. Even if they do not follow the policy exactly, it does not necessarily mean they are not protected.

Employee reading employer's report on furlough fraud investigation

Taking action in line with procedure

As soon as a disclosure is made, an employer should follow the procedure in the whistleblowing policy. In the absence of a policy, employers will need to decide what action to take and whether investigation is needed.

An employer should aim to resolve the matter as quickly and effectively as possible. They should also keep the employee informed about the actions taken and any progress made with the complaint.

Avoiding detrimental treatment of a whistleblower

Employers should also make sure they do not treat the employee differently after a disclosure is made, e.g. by dismissing them or treating them unfairly.

It should also be noted that an employer may be held responsible for unfair treatment by other employees (in the form of harassment or victimisation) because of the disclosure.

Any misconduct or poor performance on the part of the employee who has made the complaint can still be dealt with. However, it is recommended that an employer takes advice before doing so.

Making a furlough fraud disclosure as an employee

If an employee is concerned about something that happened under the furlough scheme, they should follow the procedure described in the employer’s whistleblowing policy or staff handbook.

If there is no policy, the concern should be reported to an appropriate person within the organisation, such as a line manager or union rep.

Matters like these may be reported anonymously or in confidence. However, this can sometimes make it difficult to investigate the claim.

Lawyer being consulted over furlough fraud claims

Obtaining professional help with post-furlough whistleblowing claims

Whistleblowing often involves complex and highly sensitive sets of circumstances. A variety of issues can be involved.

Post-furlough whistleblowing claims are also new territory for tribunals, and are therefore surrounded with an element of uncertainty.

Acknowledging the matter and dealing with it in a fair, timely and open manner is essential if employers wish to avoid a tribunal claim.

If you have any concerns about furlough-related whistleblowing claims, it is recommended that you seek professional advice.

Whether you are a worker who has been mistreated after making a disclosure, or a business owner worried about mishandling a furlough abuse claim, our team of experienced employment law solicitors can guide you through your options. Get in touch today for a consultation.

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