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    3 August 2020

    Dealing with redundancy

    The coronavirus pandemic has had an impact on many businesses, with the prospect of having to make redundancies unavoidable for many.

    The Guardian recently reported tens of thousands of people are facing redundancy as a result of the Coronavirus pandemic. The government has supported many businesses and employees with the introduction and extended furlough scheme to encourage businesses that have been affected by the pandemic to maintain their workforce, as the scheme begins to be phased out over the forthcoming months many companies are now facing the tough decision to make employees redundant.

    Redundancy occurs when employers need to reduce their workforce because a job or jobs are no longer needed. For a redundancy to be genuine, you must demonstrate that the employee’s job will no longer exist, this might be because your business is:

    • changing what it does, for example other employees are doing the work you carried out
    • doing things in a different way, for example new systems implemented within the workforce
    • changing location or closing down
    • the business is being transferred to another employer

    Employment Solicitor, James Conley, answers common questions raised surrounding dealing with the redundancy process, what an employee is entitled to and how a Solicitor can help an employee facing the prospect of redundancy.

    Q1. What steps are involved in dealing with the redundancy process and when should an employee speak to a solicitor about redundancy?

    The process will depend on how many redundancies are proposed but, generally speaking, whenever a company considers making redundancies there should always be a period of consultation. During this consultation period the employee will have the chance to challenge the redundancy proposals as well as their selection for redundancy and it is at this point that it would be most beneficial to speak to a solicitor.

    Q2. What would be considered an unfair redundancy?

    There are two scenarios where a redundancy situation can arise fairly – Your workplace is closing or moving, or your employer is ceasing trading altogether; or your employer has a reduced need for employees to carry out a particular kind of work.

    If your redundancy does not come about through either of those scenarios, or if your employer fails to follow a fair redundancy procedure, then the dismissal will be unfair.

    Q3. How much notice of redundancy is an employee entitled to?

    Again, this can vary depending how many staff are being made redundant at once. However, in all cases where you are made redundant you should be given your contractual notice period before the dismissal takes affect.

    Q4. How much redundancy pay are employees entitled to?

    If you have worked for your employer for two years or more, you will usually be entitled to a statutory redundancy payment (SRP). The amount of your SRP will be calculated using a set formula that considers your age, length of service and weekly pay, subject to an upper limit.

    You receive one and a half weeks’ pay for each complete year of service in which you are aged 41 or over, one week’s pay for each complete year of service in which you are aged 22-40, and half a week’s pay for each complete year of service in which you are aged under 22.

    The weekly gross pay is capped at £538 and the length of service is capped at 20 years. The maximum amount of statutory redundancy pay is £16,140.

    Q5. Can an employee challenge their employer if they feel they have been unfairly chosen for redundancy?

    Yes, and you should. If you feel that the criteria you have been assessed against are discriminatory or unfair, or if you been given a score well below what you were expecting, you should challenge your employer to explain them. A solicitor can help you write to your employer or advise you on whether your selection for redundancy was objectively fair.

    Contact us

    If you would have further questions regarding any of the points raised in our Dealing with redundancy Q&A, or you wish to speak to a member of the Employment team, please do not hesitate to call 01603 598000 or email employment@steeleslaw.co.uk. Appointments are available at our Diss, Norwich and London offices or at your offices by appointment.

    *The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

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