Can a furloughed employee start working for another organisation?

Guidance published by HM Revenue and Customs on the Coronavirus Job Retention Scheme confirms that a furloughed employee can start working for another organisation without the original employer's claim for their wage costs under the scheme being affected. The employee must not carry out any work for an organisation that is connected to the furloughing employer while they are on furlough. The employer should ask the employee to confirm the identity of the new employer before they start work and should check that it is not a connected organisation.

While the rules of the scheme do not prevent employees taking on new work while furloughed, the employees' contract may prevent them from working for another employer. Where this is the case, the furloughing employer may decide to agree a temporary change to the employee's contract to allow them to work for another employer while they are furloughed.

When deciding whether to allow the employee to take on a new job, the employer should consider whether or not it will want to bring the employee back to work part time under a flexible furlough arrangement, and whether the new job would conflict with the employee's working hours.

If the employer does not intend to make use of a flexible furlough arrangement, it should still consider whether or not there is any conflict of interest between the organisation and the new job. It should also consider what will happen at the end of the period of furlough, when the employee will be required to return to work. The employer should discuss this with the employee and ensure, for example, that they will not be tied into a long notice period in their new job. The employer should take into account the risk that the employee may decide not to return at the end of the period of furlough.

The employer should also ensure that the employee is aware that it may require them to carry out training during the period of furlough.