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18 April 2020

What amounts to statutory duties (for Directors) and work whilst on Furlough Leave?

Directors may be able to continue undertaking their statutory duties while furloughed such as filling up their accounts, etc. which would not count as doing work, but what counts as work? 

The statutory duties of directors are very limited. There are seven:

  1. Duty to act within powers
  2. Duty to promote the success of the company.
  3. Duty to exercise independent judgement
  4. Duty to exercise reasonable care, skill and diligence
  5. Duty to avoid conflicts of interest
  6. Duty not to accept benefits from third parties.
  7. Duty to declare interest in proposed transaction or arrangement

The key point is that statutory duties CAN be carried out but NO services or revenue-generating work can be conducted, and presumably this applies to any linked organisation.

Activities that would be considered as work, and therefore restricted whilst on furlough include: talking to customers, talking to suppliers, marketing your business to keep your business going, taking work calls and, although it hasn’t been confirmed, may even include posting on social media!

So, if in doubt don’t do it, or don’t furlough yourself as a Director!

Please note that HMRC has stated that fraudulent furlough claims could result in criminal proceedings.

If you are furloughing yourself as a Director, you would be well advised to notify all the company’s suppliers, customers that the business is suspended until the end of the coronavirus restrictions.


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