Frequently asked questions about being made redundant

Frequently asked questions about being made redundant

What is a redundancy?

A redundancy is basically when there is:

  • a closure of the business for which the employee was employed; or
  • a closure of the place of business where the employee was employed to work; or
  • a reduced requirement for employees to carry out work of a particular kind.

Why have I been selected?

Normally either your role is redundant for example where a whole business shuts down, or there is no longer the need for someone to do your job, in which case there is no selection. Your job simply has gone.

Alternatively there is a need for less people in which case there should be a selection made between an appropriate group, or “pool” of employees and objective selection criteria applied to them all. The person or people with the lowest scores are the people who are selected for redundancy.

What if I think I have been selected unfairly?

It is up to the employer to decide on the selection criteria and to apply them. The selection criteria should be fair and not be discriminatory, and applied fairly and equally across the pool.

There are many examples of unfair selection. They will normally be where a criteria is potentially discriminatory on the grounds of disability, race, sex, age, maternity etc, or where scoring is inconsistent. An example may be if you are selected because of your age, or have a disability or a long term illness that could be a disability and you are selected because of related sickness absence, this could be unfair. Another situation could be where a woman has had time off to care for children and this is counted against her. Any reason connecting with pregnancy or taking maternity leave will always be unfair.

Can I see the criteria and my scores?

If there is a selection process, you should be told on what basis you are being selected. Ask to see the criteria, and if you have not already been given them, you can ask to see your scores. If you are concerned, consider asking for other people’s scores on an anonimised basis.  Employers will not always give these out, but often will, and it does not hurt to ask!

What process will my employer go through?

Your employer should go through a formal consultation process with you, but how extensive this will be will depend on the organisation. Check your contract and handbook for details of a procedure.

If there is nothing set out the usual process will involve (as a minimum), writing to you to tell you about the potential redundancy, then holding a consultation meeting to discuss it, then conveying the decision to you in writing setting out any redundancy payment, and when your last day of employment will be. You should be given the right to appeal the decision.

What is the consultation meeting about?

Your employer should meet with you to discuss why the situation has arisen, how it would impact you if they do make you redundant and whether there are any ways to avoid having to make you redundant. Redundancy is a last resort and employers should have considered ways of avoiding it, before deciding finally.

If your employer has made it very clear in writing or verbally at an early stage that you will definitely be made redundant, and then does follow through with that decision, this could be an unfair dismissal (if you have over 51 weeks service), as the purpose of having meetings is to consult with you and see if the redundancy can be avoided. A letter stating you will definitely be leaving (for example) pre-judges the process and can render the dismissal as unfair. If this has happened take advice urgently from a solicitor.

Can I take someone to the meeting?

You can take a colleague or a trade union representative. You do not have to be a member of that union, or any union.

What about other jobs?

Your Employer should consider if there any other jobs with you, even if they are lower paid. This should include jobs in group companies.

If you consider a role to be suitable, you may take it on a trial basis of 4 weeks. If you continue it after the trial period you will not be redundant and your employment will continue in the new role. You will not therefore be entitled to any statutory redundancy payment.

If you unreasonably refuse suitable alternative employment, you can lose the right to a statutory redundancy payment, so consider any role offered very carefully and if it is not suitable for you personally, for whatever reason, be very clear about this.

I have been through the process and have been selected for redundancy. How can I check I am being paid what I am owed?

When you are being made redundant you are entitled to receive notice in accordance with your contract, or if there is no contractual provision, statutory notice of 1 week for each complete year of service up to 12 weeks. Sometimes employers will pay you instead of making you work out your notice period (pay in lieu).

You are also entitled to statutory redundancy once you have been employed for a continuous period of 2 years. The amount of statutory redundancy is calculated by taking into account your age, length of service, and weekly pay (capped at a maximum which is currently £380 [as at March 2010]). There is good ready reckoner for calculating your statutory redundancy payment on the Government’s Department for Business Innovation and Skills website currently at www.berr.gov.uk

Also check any contractual entitlements such as enhanced redundancy schemes, bonus schemes and share option schemes. Even if there is nothing contractual consider if your employer usually makes enhanced redundancy payments.

I am working out my notice, but want to go for a job interview.

You are entitled to reasonable time off work to look for a new job, which includes attending interviews.

 My employer says they can’t afford to pay my statutory redundancy and notice.

If your employer is Insolvent you can obtain payment from the Redundancy Payments Office. If your employer refuses to make a redundancy payment (or has made a part payment only), you can often obtain payment from the Redundancy Payments Office, however you will need to request the payment in writing from your employer and may need an Employment Tribunal judgement first. See the Insolvency Service website at www.insolvency.gov.uk for details.

I am really unhappy about being made redundant. What can I do?

You should be given the right to appeal against the redundancy and if you are unhappy you should do this, so you have been through all of your employer’s internal procedures, before considering whether to take it further.

Redundancy is never easy, but if you feel the process was unfair, or it has been discriminatory in some way, you should take legal advice.

Equally, if you believe you are not being paid what you are entitled to, take advice.

You can consider bringing a claim against your employer in the Employment Tribunal if you have reason to believe the redundancy was unfair or discriminatory. Strict time limits apply which means claims must be brought within three months.

Victoria Young is an employment solicitor in the Employment Services Team at Blocks solicitors in Ipswich. She can be contacted on 01473 343922 or emailed at vy@blockslegal.co.uk

The above is general comment only and individual advice should be taken