Wizo is correct in his definition.
If furloughed you are basically laid off from the bottom of seniority list ,ie last hired on first off.
When the company starts expanding and hiring again those on furlough are asked i they wish to return to work, in seniority order going down the list. If they refuse or if they have resigned their number in order to work for a new employer then that is their choice.
Only once the last furloughed pilot who wishes to return has done so when offered will the company then start recruiting "New Hires" off the street.
The biggest benefit for those involved is that you return at your old position on seniority list, even if re called years later instead of starting at the bottom again like a new hie would.
In the US ,unlike here in OZ, everything at the airline is strictly determined by seniority, no exceptions, Upgrades, base assignments, rosters, leave requests, extra flying etc, everything.