Redundancy

A redundancy situation arises when the need for work ceases or diminishes or for that work to be carried out at a particular place.

Redundancy is a potentially fair reason for dismissal. However it is essential that the employer carries out a fair procedure or the dismissal will be unfair even if there are genuine grounds for making employees redundant.

Notwithstanding that an employee may be potentially redundant and the employer may have already made up their mind who is likely to go, unless they follow a fair process they might face a unfair dismissal claim. This is because they have carried out the selection process unfairly or failed to consider other matters such as alternative work or reduction in hours.

We can assist in connection with the whole redundancy process, making sure that you carry out a fair procedure.

Voluntary redundancy

Whilst employers can offer voluntary redundancy they need to make sure that they don’t become contractually bound to go through with it if, for example, the employee that they wanted to retain indicates that they want to take voluntary redundancy. Employers will often become confused on how to put together selection pools and a selection matrix.

Redundancy payments

Depending on an employee’s length of service, age and the details in their employment contracts, former employees may be entitled to redundancy payments, holiday pay or unpaid wages and notice pay. Redundancy pay is based on weekly earnings before tax (gross pay), there are limits to the weekly amount and it is only paid up to a maximum of 20 years’ service. The up-to-date redundancy pay rates are available on the Government’s website.

Employees can also claim for payment of unpaid wages or other contractual monies owed e.g. bonus, commission, overtime. Depending on the speed of the process, employees may also be able to claim for statutory notice to cover the notice period that they did not get paid for.