Redundancy is a form of dismissal from your job, generally when employers need to make cutbacks or reduce their workforce.
If you're being made redundant, you may qualify for redundancy pay, a notice period, the possibility of moving to a different job within the company, time off to find a new job, and a consultation with your employer.
Redundancy selection should be fair, such as your experience or level of capacity to do your job, and it cant be based on age, gender, disability or personal circumstances. If this is the reason you have been provided with for your redundancy, then it could be classed as 'unfair dismissal'. Advice on this or redundancy can be found on ACAS or Citizens advice sites.
Your employer may not need to follow a selection process when it comes to making you redundant, such as if the business is closing down or if you're the only employee in your part of the organisation. Commonly used reasons for redundancy may be:
· Last in first out (employees with the least number of years service). Employers cant make only young people redundant.
· Asking for Volunteers (Self-selection)
· Disciplinary records
· Skills
· Staff appraisal marking
· Experience and Qualifications
If more than one person is within the selection process (i.e. you both have the same job and capability to do that job), you may be asked to 're-apply' for your job. If you do not re-apply or you are not successful, you will still have a job until your employer follows the correct route to make you redundant.
If for any reason, you feel that you have been unfairly selected for redundancy, you have the right to appeal. You can do this in writing to your employer, explaining why you believe you have been unfairly selected. If you are not satisfied with the response to your appeal, you may claim unfair dismissal through an employment tribunal.
Volunteering for redundancy must be offered to all and cant be limited to specific age groups; this could be unlawful age discrimination. However, employers can provide an early retirement package for specific age groups.
If you have been with an employer for over two full years of service, you will be entitled to statutory redundancy pay. You could expect to be paid the following:
· half a week's pay for each full year you were under 22
· one week's pay for each full year you were 22 or older, but under 41
· one and half week's pay for each full year you were 41 or older.
Length of service is capped at 20 years, and your weekly pay is an average of your earnings over the 12 weeks before the day you were given redundancy notice. If, however you were on furlough during this time, your average is based on 100% of your wage and not the furlough amount.
The maximum weekly cap for redundancy in 2021-2022 is £554.00, and redundancy pay, including severance, isn't taxable up to £30,000; however, wages and any holiday pay owed will still face deductions for tax and ni.
In some circumstances, you won't be entitled to any redundancy pay. These cases may be that your employer is offering to keep you on or has offered you a suitable alternative to work which you refuse without good reason.
· You must be given a notice period before your employment ends. Statutory redundancy notice periods are: at least one week's notice if employed between one month and two years
· one week's notice for each year if employed between 2 and 12 years
· 12 weeks' notice if employed for 12 years or more
However, your contract may stipulate more than the statutory minimum, but it can not be less.
As well as statutory redundancy pay, your employer should pay you through your notice period or pay you in lieu of notice, depending on your circumstances. PILON or pay in lieu of notice can be paid without any notice period, and this is where your employer pays you instead of giving you notice. You should check your employment contract for this, but it can be paid even if it's not included in your contract.
If you're being made redundant, you are entitled to a consultation period. This involves discussing why you being made redundant and whether there are any alternatives to the redundancy. If your employer makes over 20 employees redundant, then collective redundancy rules apply; however, if you are one of up to 19 employees being made redundant, there are no rules about how an employer carries out the redundancy consultations. If your employer doesn't carry out the correct process, you could make a claim to an employment tribunal.
Collective redundancies are when an employer makes more than 20 employees redundant ; this could occur amongst employees and their representatives (such as a trade union or elected employee). Collective redundancies must discuss ways to avoid redundancies such as cost saving exercises, the reason for redundancies, how to keep the numbers minimal, and how to limit the effects for those employees involved. Employers must also meet certain legal obligations such as informing the RPS (Redundancy Payment Service) plus other obligations.
If an employer offers alternative employment, this must be similar to the job you are already doing. If your employer has a suitable alternative and doesn't offer it to you, you may be able to make a claim to an employment tribunal. If, however you did take up the offer of alternative employment, you do have the right to a four week trial period; however, it can be extended if your new position requires training. If, however you refuse the suitable alternative, then you may lose the right to redundancy pay.
During your notice period, you are entitled to 'a reasonable amount' of time off to look for another job or arrange the relevant training to find another job. How long you are entitled to will depend on your circumstances.
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