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Redundancy

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Redundancy has a set legal definition. Redundancy can occur where the employer has ceased or intends to cease to carry on business for the purpose of which the employee was employed or to carry on that business in the place where the employee was employed. Redundancy can therefore occur where a business ceases to trade or closes a site or moves its operations elsewhere.

Redundancy can also occur where the requirements of that business change so that the need for employees to carry out work of a particular kind or for employees to carry out work of a particular kind in the place the employee was employed has ceased or diminished or expected to cease or diminish. This could be a requirement for fewer employees to do the work due to a downturn in orders or ceasing to provide administration at a particular location.

Redundancy should be fair and not personal, it is about the role, not the person. The redundancy process should be fair and unbiased. This should entail warning and consultation before a decision to dismiss is taken. A re-organization does not always mean that there is a redundancy situation there would normally need to be a reduction in employees required to meet the statutory definition of redundancy.

If there are employees doing the same job as you or similar and they were retained, then check to see if you were put in a selection pool with them and the selection criteria were marked fairly. Selection criteria should be objective, not subjective, and be marked in a fairway. Fair consultation also includes exploring with you suitable alternative employment within the organization. Was there a vacancy in the organization which you could do but were not offered the chance to apply?

Where 20 or more employees are dismissed as redundant at any one establishment in a 90 day period there is a requirement for the employer to collectively consult. This could be through any union, any elected representatives, or by electing representatives to consult with. This normally makes the consultation periods longer and for a set period of either 30 or 45 days depending on the number of proposed redundancies. If employers fail to collectively consult this could entitle you and all employees affected to a protective award of 90 days pay.

Employees still need two years of service to bring a claim for unfair dismissal in a redundancy situation unless their selection for redundancy was for one of the automatically unfair reasons which are limited but include being selected for health and safety reasons, refusing to work Sundays, whistleblowing, etc. Those who are on maternity leave who have been put at risk of redundancy are subject to special rules and if you are pregnant or on maternity leave you should seek legal advice.

Sometimes redundancies occur when there is or should be a TUPE situation. This is where you transfer to a new employer or should have done so. For further information on this review the information on TUPE transfers.

Those with two complete year’s service are entitled to a statutory redundancy payment from their employer. If your employer is insolvent you may be able to recover this from the state. The redundancy payment is worked out by calculating a multiplier based on age at the time of dismissal and the number of complete years of service. This is multiplied by your gross weekly salary subject to the statutory cap on a week’s pay which changes every year.

If you are being made redundant, have been dismissed for redundancy or have not been paid your redundancy payment, or are concerned about whether you have been treated fairly, please contact us on 01604 700099 for an initial telephone consultation to discuss your case.