11 Mar 2021

Employment

Know your rights if you’re facing redundancy

While it has offered a glimmer of hope, last week’s Budget announcement served as a stark reminder of the devastating affect that the Covid pandemic has had on the economy. Unemployment is at the highest level for five years and looks set to increase further in the months to come.

As millions of workers continue to worry about the security of their jobs, our head of employment law, Daniel Wilde, gives his advice on employee rights for anyone facing redundancy.

Last week’s Budget announcement offered some welcome relief for the millions of people concerned about keeping their jobs, with the extension of both the furlough scheme and of Government grants for the self-employed. Chancellor Rishi Sunak predicted that, thanks to the UK’s rapid vaccine rollout, the economy will grow 4% this year and will recover to its pre-pandemic level six months sooner than expected.

However, despite these flickers of positivity, there is no escaping the fact that the numbers of people out of work in the UK will undoubtedly get worse before they get better.

The percentage of the working population registered as unemployed rose to 5.1% in the three months to December 2020 – the worst rate since 2015 – and the latest forecast from the Office for Budget Responsibility predicts that it will peak at 6.5% this year. Although this is a sobering statistic, it does paint a brighter picture than had previously been painted last July, suggesting that 1.8 million fewer people are expected to be out of work than had been predicted.

Workers in the hospitality industry, retail and entertainment have been the worst hit during the pandemic, and more than half those who have been made redundant have been under 25. With so many people facing the threat of redundancy, we outline your rights as an employee if you are concerned about losing your job in these uncertain times.

Who can be selected for redundancy?

Your employer must be able to demonstrate that those employees selected for redundancy must have been chosen fairly and objectively. In addition employers must take care not to discriminate and decision should not be influenced by:

  • Your age, race or gender
  • Pregnancy and maternity leave
  • Any disability
  • You have been a whistleblower
  • Trade Union Membership

Employers should make selections based on objective criteria such as skills, disciplinary record, sickness and qualifications. It is common for employers to ask for volunteers when announcing redundancy plans, and to offer some enhancement to statutory redundancy payments, albeit there is no obligation to accept volunteers for redundancy.

Can I be made redundant if I have been furloughed?

Yes, it is possible to be made redundant while on furlough, but the same rules of fairness apply.

However you can no longer work out notice of redundancy while your employer is claiming money from the Job Support Scheme to help fund your role. Accordingly, if your employee does serve you with notice, you will cease to be on furlough….

Can my employer make me redundant on the spot?

If you have more than two years’ service, your employer needs to follow a fair procedure. Your employer is also legally obligated to give you notice of redundancy but the amount of notice will depend on how long you have been employed by them. You are entitled to:

  • At least one week’s notice if you have been employed between one month and two years
  • One week’s notice for each year if employed between two and 12 years
  • 12 weeks’ notice if employed for 12 years or more.

Does my employer have to consult with me first?

If your employer wishes to minimise the risk of an unfair dismissal claim, your employer should invite you to a consultation meeting to give you an opportunity to ask questions and raise objections. If they are cutting 20 or more jobs at any one time, they must organise a collective consultation involving a union or employee representative and this must start at least 30 days before anyone’s job ends. If 100 or more people are being made redundant, collective consultation must start at least 45 days before anyone’s job ends.

What redundancy pay am I entitled to?

If you have worked continuously for your employer for two years or more, you are legally entitled to redundancy pay. There is a statutory minimum but some employers operate more generous schemes.

The amount is calculated by reference to your age, length of continuous service, and current salary, and you will be entitled to:

  • Half a week’s pay for each full year worked when you’re under 22
  • A week’s pay for each full year worked when you’re between 22 and 41
  • One and a half week’s pay for each full year worked when you’re 41 or older

However a week’s pay is capped at £538 up to 5th April 2021 and £544 from 6th April 2021.

To check your entitlement, you can use the Government’s redundancy calculator.

If you still have holiday days owed to you when you leave, you are entitled to be paid for those too. In the event of your employer’s insolvency, then redundancy pay and other payments may be paid by the Government.

Am I allowed any time off to find another job?

While under notice of redundancy, employees are entitled to reasonable time off with pay during working hours to seek alternative work. There is no stipulated amount of time off which employers need provide, but the maximum an employer can be required to pay is 40% of weekly earnings.

If an employer refuses time off or payment for the time off, employees can submit a claim to a tribunal that can order the employer to pay. The complaint must be made within three months of the employer’s refusal.

If you are facing redundancy and have any questions relating to your employee rights, our expert employment law team is here to help. Please contact Daniel Wilde on danielw@hevans.com or 01633 244233.

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