When employers need to downsize their workforce and you are faced with redundancy, you have a legal right that your employer must treat you fairly in accordance with your contract of employment and statutory redundancy rights. These include rights to a fair redundancy selection process, giving you a proper notice period, rights to consult with your employer, the option of moving into a different job, and rights to time off to search of a new job.
Let's breakdown each right and take a closer look at what they mean individually.
Your right to a fair selection process
Your employer must use a fair process in selecting jobs to make redundant, for instance, based on staff appraisal, skills, qualifications, and experience in performing a task. You cannot be made redundant based on race, age, gender, religion, health, or if you are on maternity leave. If you think you have been selected for unfair dismissal, you have the right to appeal by writing to your employer explaining the reasons. If you are still not satisfied, you can make a claim to an employment tribunal.
Your right to a redundancy pay
If you have been working for your employer for a minimum of two years or more, you have a right to statutory redundancy pay. The amount you are paid is dependant on your age and how long you have worked for your employer.
How your redundancy pay is calculated:
Half a week's pay for each year of complete service in which you were aged 18-22
One week's pay for each year of complete service in which you were aged 22-40
One and a half week's pay or each year of complete service in which you were aged above 41
Your right to a period of notice
You have a right to be notified by your employer if you have been selected for redundancy.
According to redundancy law, your employer must give you a minimum of
12 weeks' notice if you have been employed for 12 years or more
One week's notice for each year if employed between two and 12 years
At least one week's notice if you have been employed between one month and two years
Payment in lieu of notice
Your employment contract can have your employer giving you a lump sum called payment in lieu of notice (PILON) instead of giving you a notice period. You may still be offered this payment by your employer, even if it is not stated in your employment contract. If you accept it, you should receive the full pay and any other bonuses in your contract.
Your right to consultation
You have a right to consult with your employer before accepting your redundancy. You should be asking questions like, ‘why you are being made redundant and if there are alternatives to consider.’
There are different rules for consultation based on the number of employees listed for redundancy. If your employer is making less than 20 employees redundant, your employer needs to consult with you individually. But if making up to 20 or more redundancies at once, your employer must carry out collective consultation.
You can make a claim to an employment tribunal if your employer does not do proper consultation before making you redundant.
Your right to be offered a suitable alternative employment
Your employer might offer you suitable alternative employment within your organisation or company.
The suitability of the alternative job depends on:
How related the work is to your present roles
Terms of the job offered
Your skills, abilities, and experience
The pay and benefits attached
Your redundancy may be unfair if your employer has a suitable alternative job and you are not being offered. However, if you are offered suitable alternative employment and you unreasonable refused to accept it, you may lose your right to statutory redundancy pay. You have the right to try any alternative employment you are offered for four weeks. You can make a claim to an employment tribunal if you think the job you have been offered is not suitable.
Your right to time off in search of a new job
If you have been working continuously for two years by the date your notice period expires, a fair amount of time off is required to:
Look for another job
Arrange training to help you find another job
No matter how much time off you take to hunt for another job, you can only receive up to a maximum of 40% of one week's pay.
For example, you work five days a week, and you take a total of four days off for
the whole notice period, your employer will only have to pay you for the first two days.
Now that you understand your rights when it comes to redundancy, you can now use this as a checklist to ensure your employer is following the due course according to the law. You can also prepare your list of questions and actions to take to minimise the impact of this experience. If you are feeling stressed about being made redundant, check out our other blog posts on Job Loss: Effective steps to overcome and Job loss: How to prepare financially.