Redundancy

What is redundancy?

A reduction or ceasing of a particular kind of work. This can involve: a reduction in the type of jobs required by your employer or the closure of your employer’s business as a whole or, alternatively, just at the place where you are employed. It can also involve a reorganisation of work where your employer’s business continues to trade but restructures its workforce to such an extent that different jobs are required and some posts are no longer needed.

If you are selected for redundancy, your employer must give you as much notice as possible, use a fair selection process, and consider alternative employment for you within the organisation, otherwise the dismissal may be unfair.

My employer says that the reason for my dismissal was redundancy. Is this true?

In order for there to be a genuine redundancy situation one of the following must have happened:

• the business closes down completely
• the place of work closes down
• the requirements of the business for employees to carry out work of a particular kind has ceased or diminished

In order to carry out a dismissal for redundancy fairly, what is the correct procedure for the employer to follow?

There needs to be consultation with the employee individually (and sometimes an employee representative). This should discuss the possibility of redundancy, and the time frames involved. There should then be a fair selection process applied (where possible), and the employer should consider any suitable alternative work they may be able to provide the redundant employee. The ACAS statutory Code of Practice on discipline and grievance does not apply to redundancy. 

I am currently in my notice period, as I was made redundant. My boss won’t let me take any time off to look for new work. Am I entitled to any time off?

You have the right to a reasonable amount of paid time off to find new work and make arrangements for future work.

Who has the right to receive a redundancy payment? How much is payable?

A redundancy payment may be the statutory minimum, or an amount that the employer offers which exceeds the minimum (known as an enhanced redundancy payment). For an individual to be entitled to a Statutory Redundancy Payment (SRP) there is a criteria that needs to be met. The individual must be an employee, and have at least two years continuous service. The employee must have been dismissed, and the reason for the dismissal must have been redundancy.

The SRP is calculated according to the following formula:
length of service (up to a maximum of 20 years) x age (calculated by the use of an ‘age factor’) x a week’s pay (to the maximum of £430 as at 1st February 2012).
This gives the maximum amount of £12,900. A claim for a SRP must be presented to an Employment Tribunal within six months. A grievance also needs to be raised first.

My employer formally consulted with me about my redundancy so I secured another job. They have now told me that they are no longer making the redundancies. Can they do this? Will I lose my redundancy payment?

There is no genuine redundancy situation and as such you are not entitled to receive SRP. You do not seem to have had the redundancy confirmed to you before you secured another job. In effect, you have no recourse against your employer and you must decide whether you want to choose to leave of your own accord.

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