EMPLOYEE FURLOUGH NOTICE
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RE: Notice of Temporary Furlough
Dear ________,
Due to circumstances affecting the operations and financial stability of ________ (the “Company”), the Company has determined that it must implement temporary cost-saving measures in order to preserve the business and protect its workforce to the greatest extent possible. This letter serves as formal written notice of a temporary furlough of your employment and memorializes the terms applicable to that furlough.
This letter also confirms in writing the substance of our discussion with you on ________, during which the current state of the Company’s business and the anticipated furlough were explained to you.
§ 1. Nature of Furlough. A furlough is a temporary, unpaid leave of absence. It is not a termination of your employment. During the furlough period described below, you will:
(a) remain an employee of the Company;
(b) not be assigned or permitted to perform any work or job duties for the Company;
(c) not be required or permitted to report to any Company work location or to perform any services remotely;
(d) not receive any salary, wages, tips, commissions, or other compensation from the Company for the furlough period, except as required by applicable law; and
(e) continue to be employed on an at-will basis, except as otherwise provided by any written employment agreement or collective bargaining agreement between you and the Company.
§ 2. Furlough Period. Your change in status to a furloughed employee will take effect on ________ and is currently scheduled to end on ________. The Company reserves the right, in its sole discretion and to the extent permitted by applicable law, to extend, shorten, or otherwise modify the furlough period, or to recall you to work earlier, upon written notice to you. All other terms and conditions of your employment that are not expressly modified by this letter will remain in effect during the furlough period.
§ 3. Recall Notice. The Company will provide you with at least ________ advance notice before you are required to return to work. The Company will communicate with you using the contact information currently on file. If you prefer an alternative method of communication, or if your telephone number, email address, or mailing address changes during the furlough period, please promptly notify the Company so that we may maintain reliable communication with you.
§ 4. Compensation for Final Work Period. You will be paid all wages earned through the effective date of the furlough in accordance with applicable federal and state wage payment laws. To the extent required by the law of ________, accrued and unused paid time off will be addressed in accordance with the Company’s policies and applicable law. Any questions regarding your final pay should be directed to ________.
§ 5. Use of Accrued Leave. Whether you may elect to use accrued paid time off, vacation, or other paid leave during the furlough period will be determined in accordance with the Company’s policies, the terms of the applicable benefit plans, and applicable law.
§ 6. Employee Benefits. Subject to the terms of the applicable benefit plans, plan documents, and applicable law, your participation in Company-sponsored benefits during the furlough period will be administered as follows. The Company will provide you with information regarding your group health plan coverage, any required employee contributions, and your rights to continued coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA) and/or any applicable state continuation-of-coverage law, to the extent those rights are triggered. If you have questions regarding the status of your benefits during the furlough period, please contact ________.
§ 7. Unemployment Benefits. Because the furlough is an unpaid leave during which you will perform no work, you may be eligible to apply for unemployment insurance benefits through the unemployment agency of ________. The Company makes no representation as to your eligibility, which is determined solely by the applicable state agency. You are encouraged to contact that agency directly for further information.
§ 8. Continuing Obligations. During the furlough period, you remain bound by all continuing obligations under your original employment agreement and Company policies, including, without limitation:
(a) your obligation to maintain the confidentiality of all proprietary, confidential, and trade secret information of the Company, in accordance with your original employment agreement and applicable law;
(b) your obligations regarding the return and non-use of Company property and information; and
(c) any non-competition and non-solicitation covenants set forth in your original employment agreement, but only to the extent such covenants are valid and enforceable under the law of ________.
§ 9. No Performance of Work. To preserve the unpaid status of this furlough and to comply with the Fair Labor Standards Act and applicable state wage-and-hour laws, you must not perform any work of any kind for the Company during the furlough period, including responding to work emails, taking work calls, or otherwise rendering services. If you are directed by an authorized representative of the Company to perform any work, you will be compensated for that time in accordance with applicable law.
§ 10. No Modification of At-Will Status. Nothing in this letter alters the at-will nature of your employment (where applicable) or constitutes a guarantee of continued employment, future recall, or any particular furlough duration. This letter does not constitute a contract of employment for any fixed term.
§ 11. Governing Law. This notice and the matters described herein shall be governed by the laws of the State of ________ and applicable federal law, without regard to conflict-of-laws principles.
We appreciate your understanding and patience during this difficult time. The Company remains committed to keeping you informed and hopes to resume normal operations as soon as circumstances permit. Please do not hesitate to contact us with any questions or concerns.
Sincerely,
________________________________
________, ________
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ACKNOWLEDGMENT OF RECEIPT
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________, Employee
Date: ________