17 November 2015
What is Redundancy?
In this blog we will answer some of the most frequently asked questions on redundancy, including what is redundancy? What are my rights when it comes to redundancy? And how does redundancy pay work?
What is Redundancy?
Redundancy is when you are dismissed by your employer because they no longer need anyone to do your job, or can make do with less people. This could be because new machines have been brought in to do your job, because your company is changing what it does, where it operates from or because the business is closing.
You should be aware that if someone directly replaces you in the role you lost this is NOT redundancy. An employer must be able to demonstrate that an employee’s job no longer exists, or it has an overall reduction in headcount, in order for the redundancy to be legal.
What Redundancy Rights do I Have?
1. The right not to be selected unfairly – You cannot be selected for redundancy just because you’re pregnant or away on maternity, paternity or Shared Parental Leave. Just as you cannot be selected for redundancy based on your age, race, sex, sexual orientation, disability, religion or belief. Any attempt to do so would mean you have a case for discrimination, and if you lose your job also unfair dismissal.
If you are selected for redundancy you should have the reason why you have been selected explained to you. This is not a set list, but reasons can often include your skills and experience. Other things your employer might consider are your attendance and disciplinary record, your history of success in your job and the standard of the work you have produced. You may wish to request sight of the scores of colleagues you have been pooled against, in order to challenge your selection if you believe this was unfair.
If you are selected for redundancy purely based on your length of service this could potentially be unlawful age discrimination.
2. Consultation – Your employer is legally obliged to undertake a collective consultation process where they look at the possible ways to avoid making redundancies if they plan on making a large number of staff redundant. There are specific legal requirements, including election of employee representatives, minimum time periods and particular points to consult on.
In an individual redundancy situation, or where smaller numbers are affected, employers often still conduct a consultation process. Once a selection for redundancy is confirmed, your employer should review the alternative options with you. You also have the right to appeal against your dismissal.
3. Alternative job – If there is an alternative job available within the business that would be suitable for you then you should be offered it. If your employer fails to do this then your redundancy could be unfair dismissal.
4. Time off to find new job – You’re allowed a reasonable amount of time off work to hunt for a new job so long as you have been in continuous employment for two years by the time your notice period ends.
5. Notice period – If you have been selected for redundancy then you must be given a notice period. The minimum amount of notice you are legally entitled to receive depends on your length of service.
One month – two years: a weeks’ notice minimum.
Two – 12 years: one weeks’ notice for each year of employment.
12 years or more: 12 weeks’ notice.
You should receive your redundancy payment shortly after being made redundant. You are entitled to redundancy pay if you have a contract of employment and have been working for two continuous years or more. You are not entitled to a redundancy payment if you were dismissed for another reason or unreasonably reject suitable alternative employment.
Statutory redundancy pay is the minimum your employer is required to pay you. They might pay you enhanced redundancy if it is written into your contract of employment, or if it’s their standard procedure. Your statutory redundancy payment depends on your age and how long you have worked for. You can use the HM Government’s Statutory Redundancy Pay Calculator to figure out how much redundancy pay you should be getting.
Slater and Gordon Lawyers advise employees on their legal rights in redundancy consultation cases. We can advise you on whether you have been unfairly selected for redundancy, if your consultation process was legally adequate, what steps you can take in relation to suitable alternative work and if you have a case for unfair dismissal.
Call our Redundancy Law Solicitors on freephone 0800 916 9060 or contact us online to get expert advice on your redundancy situation.