As the coronavirus from China spreads and businesses close down, so too does the question of what is a furlough vs. layoff?
Some employees are likely hearing about furloughs and layoffs during the coronavirus outbreak, but they aren’t the same thing. Let’s go over the difference between a furlough vs. layoff below.
- A furlough is a temporary leave of absence while a layoff can be permanent.
- Employees that are part of a furlough get to return to their work without losing their position.
- The same isn’t always true of a layoff.
- A point where furlough vs. layoff doesn’t differ is in pay, with both circumstances resulting in none.
- However, employees that are on a furlough often get to keep their benefits.
- It’s also worth noting that laid-off employees are able to withdraw unemployment.
- That’s not always the case with a furlough as that’s up to each state to determine.
One major retailer that has announced a recent furlough is Macy’s (NYSE:M). The move will affect nearly all of its 130,000 employees as the company seeks to reduce costs during the coronavirus outbreak.
Macy’s has already closed down its stores and now plans to keep them closed through May. However, the retailer will still be keeping some employees around to manage its online business, which is still operational.
M stock was down 7.64% as of Tuesday afternoon.
As of this writing, William White did not hold a position in any of the aforementioned securities.