An employee furlough is when staff members are required to take an unpaid leave of absence. Employee furloughs help businesses cut costs and retain talent, but employees receive less or no income and may be tempted to find a new job.How long can a company furlough an employee?
Furloughs can last for up to six months before a company is required to decide if a worker is returning or not. This means there is a chance of economic exposure pending how long the furlough lasts.Is furlough a termination of employment?
Since a furloughed employee is not terminated from employment, he or she may still be considered an active participant in the retirement plan.