Redundancy is a form of dismissal which occurs when an organisation needs to reduce its workforce due to business closure, or no longer requires workers as the job disappears.
You may be eligible for certain rights when being made redundant, which include:
You must be given a notice period before your employment ends. A statutory minimum exists in the UK based on how long you have been employed by your company. Check your contract – your employer may offer you more than this statutory minimum but cannot offer you less.
If you have been working for your current employer for two years or more, you’ll normally be entitled to statutory redundancy pay. The exception is if your employer offers to keep you on, or offers you suitable alternative work which you refuse without good reason.
Your employer should also pay you through your notice period. Check whether your contract includes a ‘payment in lieu of notice’ clause. This means that should your contract end without any notice, money is paid to you as an alternative to working your notice period.
Consultation with your employer
This involves a discussion about why you are being made redundant, and any alternatives to redundancy that are available. If your employer doesn’t consult adequately, you can make a claim to an employment tribunal. Be aware of the fees you will have to pay as part of the process. They vary depending on the type of case. For more information, visit www.gov.uk/employment-tribunals.
If your employer is making 20 or more employees redundant – a collective redundancy - the consultation should occur between your employer and either a trade union representative or an elected staff representative.
Suitable alternative employment
You may be offered a different job within your company. If your employer has suitable alternative jobs available but you are not offered them, your redundancy could be classed as unfair dismissal. You may lose your right to statutory redundancy pay should you unreasonably turn down an available position. You also have the right to a trial period for alternative employment offered. If you are unsure of your circumstances, get independent advice – for instance from a union.
Time off to find a new job
You may be allowed a reasonable amount of paid time off work to look for another job or to arrange training to find a new job.
The selection process
You must be fairly selected for redundancy (unless the reason for selection is that your job no longer exists). The most commonly-used methods are:
- Last in, first out
- Asking for volunteers (see voluntary redundancy, below)
- Staff appraisals, skills, experience and qualifications
This could be the case if your employer’s selection is based on any of the below. You have a right to appeal to your employer, or make a claim to an employment tribunal.
- Gender, sexual orientation, race, religion, age, disability etc
- Pregnancy or maternity/paternity/dependants leave
- Membership (or non-membership) of a trade union
- Working pattern (full or part-time employee)
- Making disclosures about your employer’s wrongdoing (whistleblowing)
- Doing jury service
If you volunteer for redundancy, it is your employer’s decision whether they select you. Your employer cannot solely offer voluntary redundancy to staff eligible for an early retirement package – this is unlawful age discrimination.
How your trade union can help
Contact your trade union for information and advice on:
- Your rights associated with the redundancy process.
- Statutory redundancy pay and notice periods.
- How to appeal a redundancy decision or make a claim to an employment tribunal.
For detailed information on your rights, how to calculate your statutory redundancy pay and how to handle staff resignations, visit GOV.UK and search for ‘redundancy’ or find out more from a recognised union. Visit workSMART to find a union.