Six COVID-related claims you could face this year

  • Health & Safety
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Peninsula Group, HR and Health & Safety Experts

(Last updated )

Thanks to the pandemic, you dealt with a lot in 2020. Don’t pay the price of a COVID-related claim – read on to find out how.

Furlough payments. Self-isolating staff. A national lockdown… 

Thanks to the pandemic, you dealt with a lot in 2020. And after such a rocky year, you won’t want to add a legal dispute to the list. 

Don’t pay the price of a COVID-related claim – read on to find out how. 

Watch out for civil claims

The government is clamping down on businesses who violate COVID-19 measures. With the guidance written into the law, you could face a fine – or even a court case – for any mistakes. 

Furlough fraud

Are staff working while they’re recorded as being on furlough? That’s furlough fraud. 

And if a business uses the scheme to claim back money for a fake or ex-employee, that’s also a clear-cut case.  

However, it’s not always as simple as that. Something as minor as calling a furloughed employee for work advice could count against you. And when you first got to grips with the scheme, you might have committed furlough fraud without realising. 

For example, you could mistakenly claim more than you’re entitled to. As the scheme dropped from 80 to 70 percent of employee wages, you might have been late to adjust your claim. 

Add the sudden introduction to flexible furlough, and it’d be easy to claim for the wrong number of hours.  

The good news is, owning up to errors means you can avoid legal trouble. The government will consider whether you acted deliberately or not – so calling HMRC and paying back what you owe should be the end of the matter. 

Failing to let staff self-isolate

If your employee tests positive for COVID-19 – or had contact with somebody who has – they need to self-isolate for 10 days. 

Imagine if they bought the virus into your workplace. It could put your staff and customers at serious risk of infection.

And not only that, but it can lead to a hefty fine. If you deny time off for your COVID-suffering staff, the government could slap you with a Fixed Penalty Notice:

  • £1,000 for a first offence
  • £2,000 for a second offence
  • £4,000 for a third offence
  • £10,000 for a fourth and following offences

After a year of setbacks and lockdown restrictions, a fine could be devastating. 

Luckily, you can easily take steps to avoid this claim. 

If your employee feels up to it, they can work from home. However, this might not be an option for you – for example, if you run a takeaway or a garden centre. You might have to consider hiring temporary staff or tweaking the team rota to manage their absence. 

Remember, your staff are entitled to Statutory Sick Pay if they have coronavirus and can’t work from home. There’s no four-day waiting period – you should pay this as soon as they start self-isolating. This applies to any employees who earn an average of at least £120 a week.

Avoid these COVID-related tribunal claims

Along with any civil claims, you could also face COVID-based accusations from your staff. This could lead to a tribunal case – not to mention a lousy team morale – so it’s something you want to avoid. 

Unfair dismissal 

If your business is paying the price of lockdown measures, you may need to make some staff redundant. 

COVID-19 has led to more uncertainty around this topic. For instance, you might not think you need to follow the full redundancy process for staff on furlough. In reality, you always need to follow the complete process – whether your team is working or not.

Here's what the process looks like:

  • Check there’s no alternative to redundancy (i.e. leaving them on furlough)
  • Consult with everyone at risk 
  • Choose who to make redundant
  • Give notice and redundancy pay

None of that changes simply because staff are on furlough. You might need to carry out some conversations remotely, but the difference ends there. 

Aside from following the right redundancy process, you also need to consider whether a COVID-related dismissal is fair, too. 

For example, some businesses have had to work around the clock during the pandemic. Your staff have a right to refuse working over 48 hours a week, though – so you can’t dismiss them for opting out. 

Plus, your staff are entitled to blow the whistle if you aren’t following COVID-19 safety measures. Sacking staff for reaching out to a third-party could lead to a costly tribunal. 

Constructive unfair dismissal 

Have staff handed in their notice due to COVID-related measures? They could claim for constructive unfair dismissal if the measures weren’t clear in their contract.

In plain English, this means your staff felt they had no choice but to leave your company. It could be that you didn’t respond to their COVID-related grievance. Or they might have even felt your workplace was unsafe. 

Whatever the reason, staff can claim if you’ve employed them for two years or more. To avoid claims, get the green light before putting any measures in place – and make sure you’ve got the consent in writing.  


Discrimination claims aren’t just COVID-19 specific. But since the pandemic took over, there’s more opportunity for these accusations.

Many discrimination claims emerge after a dismissal. And as the financial impact of COVID-19 takes its toll, dismissals are increasingly common. 

When you select staff for furlough or redundancy, you need to follow a completely objective process. If it comes down to choosing between certain team members, base your decision on things like:

  • Their standard of work
  • Their disciplinary record
  • Their relevant skills 
  • Attendance record (not including any time off due to pregnancy, maternity, or disability)

Dismiss shielding workers for staying at home, and this could be disability discrimination. And if you let staff go due to their flexible or reduced hours, this could be discriminating against their employment status.  

Unlawful deduction of wages

The furlough scheme might have provided you with some much-needed relief. However, if you don’t pay attention to certain rules, you could face a costly tribunal – which could cancel out any support. 

For example, if furloughed staff use their annual leave, they need to receive their full pay - not just the reduced 80% rate. And not paying your staff the correct rate could be an unlawful deduction of wages.

Along with any furlough confusion, lowering staff wages could also lead to an employment tribunal. As lockdown measures are tough, it’s not wrong to reduce pay full stop – but you should always get signed consent first. Skip this stage and you could face a claim. 

Stay in control with employment law advice

You’re doing your best to follow the rules – but the confusing COVID-19 landscape could leave you vulnerable to claims.

With our specialist employment advice, you can be sure you’re always in control. Our HR experts make sure you avoid the hassle of any legal disputes. And if the worst happens and you do face a claim, we’re here to plan your next steps.    

With our 24/7 support line, our clients can access personalised help whenever they like. Simply give us a call on 0800 028 2420.

Not yet a Peninsula member? Just fill out our enquiry form and we’ll take it from there. 


Got a question? Check whether we’ve already answered it for you…

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