Worried about redundancy?

The prospect of redundancy is a heavy weight on many employees’ minds and is particularly common in the current economic climate.

Your employer has the legal right to make a business decision that they wish to make redundancies, as long as they can show there is a “reduced need for employees to do work of a particular kind” or the business or a particular site is closing. However, even if your employer can meet this definition, if you are being faced with the prospect of redundancy, it must still be done fairly.

Reasons for Redundancy

Common reasons for redundancy include workplace closures, business reorganisation, a relocation of the business or technological advances. If you are being made redundant, your employer has a duty to consult with you, to try to find ways of avoiding your redundancy and present you with any alternative job vacancies within the company.

Your employer should notify you of how many employees they are proposing to make redundant and should place you in a “selection pool” if there are other employees with the same or a similar job role. Your employer should then score you and your colleagues using a redundancy matrix with objective selection criteria, give you the opportunity to comment on this and apply the scoring consistently and fairly in order to identify the employees with the lowest scores, who are then likely to be made redundant. If you are pregnant or on maternity leave, you could have additional protection from redundancy and we recommend seeking detailed legal advice if this is the case.

Collective Redundancies

If your employer is proposing to make 20 or more employees redundant at one establishment over a period of 90 days or less, they are obliged to consult collectively with employee representatives or a trade union. An employer’s failure to comply with this obligation could mean a protective award of up to 90 days’ gross pay being made in favour of each affected employee. If an employer is proposing to dismiss 100 or more employees within a 90 day period at one establishment, consultation must begin at least 45 days before the first dismissal takes effect and if the proposals affect between 20 and 99 employees within a 90 day period, consultation must begin at least 30 days before the first dismissal takes effect.

Redundancy or Lay Off

Occasionally an employer will “lay off” employees as an alternative to making redundancies. It should be noted that your employer only has the right to do this if it is in your contract of employment, it has become “custom and practice” or if you agree. Lay off is the term used when employees are not required to attend work for a limited period of time due to a lack of work.

A redundant employee with over two years’ qualifying service is entitled to a redundancy payment under statute (or under contract if your employer operates an enhanced redundancy payment scheme). The statutory redundancy payment is based on your gross weekly salary, age and length of service (from 6 April 2019 capped at £525 per week and 20 years’ service).

Unfair Redundancy

If you have been dismissed and there is not a genuine redundancy situation or your employer has not followed a fair procedure you can bring a claim for unfair dismissal as long as you have more than two year's service. Regardless of your length of service, you have the right not to be selected for redundancy on certain prescribed grounds that relate to statutory rights, health and safety, employee representation, trade union membership or the “protected characteristics” listed under the Equality Act 2010 (age, disability, marriage and civil partnership, gender reassignment, pregnancy and maternity, race, religion or belief, sex or sexual orientation). If you are made redundant on one of these grounds, you can bring a claim for automatic unfair dismissal, even if you do not have sufficient length of service to bring an Unfair Dismissal claim.

Any employee has the right to request a written statement from their employer showing how their redundancy pay has been calculated and it is a criminal offence for your employer not to provide this.

It is now a mandatory requirement for prospective Claimants to contact the Advisory, Conciliation and Arbitration Service (“ACAS”) to undertake a period of Early Conciliation (“EC”), without which a claim cannot be accepted by the Employment Tribunal.

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Simon Brian

Simon Brian

Employment Law
0114 218 4311
Email Simon
Office: Sheffield