REDUNDANCY

Why is it important?

Redundancy – making people redundant – is costly and stressful for employers as well as employees. Employers, if you are concerned about costly tribunal cases and how you could be affected, contact us here >>>

What to consider?

The Most Important:

  1. It is the position not the work performance of an employee. You can´t make a person redundant because of poor performance without going through the disciplinary procedure.
  2. Redundancy is about the work requirements of the employer. If an employee is made redundant they can and often will bring a claim for unfair dismissal to a tribunal. The risk can be minimised by use of a well crafted and mutually agreed compromise agreement.
  3. Statutory dismissal pay is calculated the same way as the basic unfair dismissal award of a tribunal so if the dismissal is found to be unfair this part of the award will be cancelled out by the previously awarded redundancy pay.
  4. Minimum qualification period for statutory laying-off employees is 2 years continuous service it is one year for an unfair dismissal claim.
  5. From the 1st April 2015 the maximum amount of a week´s pay used when calculating dismissal pay is £475 per week, maximum award is £14,250.
  6. From February 1st 2012 the maximum redundancy award achievable by an employee over 61 with 20 years service is £13,500 the maximum tribunal award for unfair dismissal becomes £74,000. These numbers are revised annually and take effect in February of each year.
  7. Age discrimination is still alive and well when calculating dismissal pay, older employees are entitled by law to more.
  8. When dismissing someone by laying them off, you must follow the same procedure as dismissing a person for any other reason.
  9. An employee being dismissed by redundancy is entitled to notice or if his contract allows payment in lieu of notice.
  10. If there are more than 20 people involved in a programme special consultation rules apply.

Shown below are 10 further points to bear in mind when embarking on a such a programme:

  1. It is a criminal  offence for an employer to fail to give written details of the redundancy pay calculation to the affected employee.
  2. If the employer is insolvent  statutory redundancy pay can be claimed from the state by following a lengthy process
  3. You must tell the employee the process used to select him/her for redundancy and give him a chance to appeal otherwise the process will be automatically unfair at a tribunal.
  4. It is illegal to select part time workers ahead of full time employees for redundancy merely because they are part time.
  5. Employees are entitled to redundancy pay even if they are within 90 weeks of starting their pension.
  6. If a job held by a woman on maternity leave is made redundant then she must be given preference for any other suitable available vacancy at the employer.
  7. Civil servants but not local government employees are exempt from statutory redundancy procedures.
  8. When considering an unfair dismissal claim the tribunal must not substitute its views for those of an employer when considering if the dismissal was unfair; rather they must deliberate whether the selection was one that a reasonable employer acting reasonably would have made.
  9. If an employer provides enhanced redundancy pay it is unlawful age discrimination to pay those being made redundant an amount calculated solely with reference to length of service or to pay them a flat amount irrespective of service length. Rather they should follow the statutory award guidelines.
  10. If both 20 employees are being made redundant and the enterprise is closing the employer must consult on both the closure and the redundancies.

What next?

Contact me now here >>>for a free 30 minute consultation to learn how we can help you save money, time, resources and stress.