Redundancy

What is redundancy?

Redundancy can occur if your employer is planning to:

• change what the business does
• change location
• change how they work, for example use new machinery or technology
• close part or all of the business

When can redundancy lead to an unfair dismissal claim?

A redundancy could give rise to an unfair dismissal claim if:

• there was no genuine redundancy situation
• an employer fails to consult
• an employee was unfairly selected
• an employer fails to offer alternative employment

What am I entitled to if I am made redundant?

Your redundancy payment depends on your age and length of service. You are entitled to:

• 0.5 weeks’ pay for each full year worked under the age of 22
• 1 weeks’ pay for every full year of service worked if you are aged between 22 and 41
• 1.5 weeks’ pay for every full year of service if you are older than 41

When a redundancy award is calculated pay is capped at £525 per week (even though you may earn more than this) and length of service is capped at 20 years. There is a maximum statutory amount for redundancy pay. As of 1^st April 2019, was set at £15,750.  The wage cap is reviewed regularly. You can use the redundancy pay calculator on GOV.UK. As an employee you are also entitled to notice pay in accordance with your contract or statute.

Who is eligible to receive redundancy?

You only qualify for statutory redundancy pay if you have worked for your employer for a minimum of two years.

What is my time limit for making a redundancy claim?

Unlike most other Employment Tribunal claims, in the case of statutory redundancy payments the time limit is 6 months less a day, calculated from the date of termination of employment.

You might also be entitled to present a claim for contractual redundancy pay, but if you wish to make an unfair dismissal claim with the redundancy claim, the 3 months less a day time limit applies.

How can I fund a claim for redundancy?

We offer various funding options for redundancy claims. If you pay us privately for the time we spend on the claim, we will give you a cost estimate at the start of the case which we will update as the case proceeds.  We can also agree a fixed fee for each stage of the work if this is appropriate. You might have legal expenses insurance which will cover our costs (your home and car insurance policies may include legal cover). In some circumstances we can act on a No Win No Fee basis.

For more information, or to discuss your case, please contact our employment law specialists Maureen Cawthorn or James Hodgson on 01422 339600.