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9-07-2020

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Redundancy FAQs

My employer has said that he is thinking about making my role redundant, what does that mean?

Redundancies are a form of dismissal that happens when an employee's job no longer exists. This may be due to an employer needing to reduce their workforce, close the business, or when certain types of work is no longer needed.

How do I know that I am being treated fairly?

There has to be a genuine redundancy situation (see above) and the employer has to act fairly when selecting a particular employee for redundancy.

What process does my employer need to follow?

Your employer should begin the selection process by identifying the group of employees at risk of redundancy.  Then they need to apply suitable selection criteria to decide who will be selected for redundancy. The selection criteria should be objective and measurable.

Can they select me for redundancy because I am on maternity leave?

It would be automatically unfair to select a woman for redundancy just because she is on maternity leave.

Does my employer have to consult with me?

Your employer should consult properly with you before reaching a final decision on whether it needs to make you redundant. This will usually mean your employer will hold meetings with you to discuss the situation. The current Covid situation means that in practice, consultations may need to be by telephone, skype or zoom.

If your employer fails to adequately consult with you, or fails to offer you the right to appeal the decision to dismiss you for redundancy, you may have a claim for unfair dismissal, depending on the circumstances.

Are there any special rules about consultation?

If your employer is considering making 20 or more employees redundant at one establishment within a 90-day period, it will also have a duty to undertake "collective consultation" with representatives of affected employees, rather than just meeting with you on an individual basis.

Your employer will also need to begin the consultation process at least 30 days before any dismissals take effect.

What Am I entitled to if I am made redundant?

If you are made redundant, you may be entitled to certain payments, depending on how long you have been employed and the terms of your employment contract:

  • Statutory redundancy pay. If you have worked for your employer for two years or more, you will usually be entitled to a statutory redundancy payment.
  • Notice pay. The amount of notice you will be entitled to will depend on the terms of your employment contract, and is subject to a statutory minimum which depends on your length of service - broadly one week per year of service up to 12 years.
  • Pay in lieu of accrued but untaken holiday or if you have taken more holiday than you have accrued as at your last day of employment, your employer may be entitled to make a deduction from your final salary payment.

If you are made redundant, your employer should write to you setting out the payments you are entitled to.

Useful websites

https://www.gov.uk/redundancy-your-rights

https://www.acas.org.uk/redundancy
 

Sarah Rushton is a partner and head of employment at Moon Beever LLP and can assist with all employment related matters you can contact her at srushton@moonbeever.com. This information is intended as a guide only.

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