Furlough

HR Glossary for HR Professionals

Glossary of the most common HR terms and acronyms to assist professionals navigating the ever-growing and ever-changing world of HR terminology.

Furlough

What is furlough?

A furlough happens when employers temporarily lay off employees from work, without pay.

Oftentimes, these furloughs last as long as the employer needs it. Although, employees who receive a furlough get to return to their jobs.

Furlough vs Layoff?

A furlough happens when an employer requires an employee to take temporary leave without pay. These employers have the expectation of their return to work. 

A layoff generally tends to be a separation that permanently ends one’s employment.

Can you collect unemployment during a furlough?

The state regulates unemployment, and state laws determine whether a furloughed employee qualifies for the benefits.

Furlough for hourly vs salary employees:

Non-exempt, or hourly employees receive pay for each hour they work. If an employer places them on a furlough, they simply receive pay for no, or fewer hours. 

Exempt, or salary employees receive pay for their full salary for any given workweek. Organizations should be careful to structure the leave so furlough doesn’t result in a loss of exempt status.

How long can a company furlough an employee?

While there’s no definite answer to this question, furloughs should only be used for short-term solutions.

In our opinion, the maximum amount of time a company should furlough an employee is one year. Even then, they should only be implemented if the company plans to recall the employee within the timeframe. 

Related Terms: Layoff

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