The employment status of an employee can be terminated at any time, but unless the redundancy is fair, an Employment Tribunal may find the employer guilty of unfair dismissal. As a result, the business must consider the main principles involved concerning the redundancy of employees including the legal procedures to be followed and statutory redundancy pay.
What is redundancy?
Under the Employment Rights Act 1996, redundancy takes place when:
- the employer has ceased or intends to cease to carry on the business in which the employee was employed
- the employer has ceased or intends to cease to carry on the business in the place where the employee was employed
- the requirements of the business for employees to carry out work of a particular kind has ceased or diminished or are expected to cease or diminish
- the requirements of the business for the employees to carry out work of a particular kind, in the place where they were so employed, has ceased or diminished.
Redundancy happens when your job disappears. It is not the same thing as being dismissed from your job for other reasons.
Redundancy selections
Your employer should use a fair and objective way of selecting people to make redundant and it must be evidence-based rather than your employer just deciding who they want to make redundant.
Usually, your job must have disappeared for your employer to make you redundant. It is not redundancy if your employer immediately takes on a direct replacement for you, but it can still be a genuine redundancy if someone moves into your job after their job disappears. This can be difficult for your employer to justify as fair, and you will still qualify for a redundancy payment so long as no vacancy exists in the area (type of work and location) where you worked.
Notice Period
The notice period is the amount of time between when your employer tells you that you are being made redundant and your last working day.
According to redundancy law, you’re entitled to a minimum notice period of:
- 12 weeks’ notice if you’ve been employed for 12 years or more
- at least one week’s notice if you’ve been employed between one month and two years
- one week’s notice for each year if you’ve been employed between two and 12 years
Redeployment by your employer
If your employer is making you redundant, they should try to offer you suitable alternative employment within the organisation or an associated company. Your employer should consider any alternatives they can make before deciding on making you redundant.
Redundancy pay
If you are entitled to statutory redundancy pay the calculation is based on:
- how long you have been continuously employed
- your age
- your weekly pay, up to a certain limit (£594 current maximum)
You should check your employment contract to see if your employer offers a more generous redundancy package.
Time off to Look for Employment
If you’ve worked continuously for your employer for at least two years, they must pay you up to 40% of a week’s pay to cover your time off. For example, you can take 2 days off to look for employment if you work 5 days a week. If you take any more time off than this, they don’t have to pay for it.
How We Can Help
If you are an employee in Northern Ireland, we will be more than happy to provide you with assistance or any additional information required on redundancy procedures so please do contact us at H McPartland & Sons Solicitors.
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