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Redundancy law - legal advice for employees

If you have any questions relating to redundancy or are facing being made redundant by your employer, please contact our expert employment law solicitors on 01616 966 229 or complete our online enquiry form for quality expert advice.

Your redundancy rights

If you are facing redundancy at work then, dependant on your length of service, you may have certain rights, including:

  • Redundancy pay (where you have been employed for 2 years or longer)
  • A notice periods
  • Time off to look for a new job
  • The option to move into ‘suitable alternative employment’, if available
  • A consultation with your employer
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Redundancy process

An employer should follow a fair and reasonable process when it believes that employees may be made redundant and should consult with them appropriately. The process that an employer must follow depends on the number of employees who are at risk of redundancy.

Where you have been employed for 2 years or more, you have a right to raise a claim for unfair dismissal if you feel that a fair process has not been followed in making you redundant. However, there is no single set process to redundancy, the only rule is it has to be clear and fair. As mentioned above, there are some set rules when it comes to consultations and how many employees are being made redundant.

Those employees who are at risk of being made redundant should be consulted with and given notice. The employer must inform those affected of the reason for the proposed redundancies and the method of selection that will be used to decide which of those employees are to be made redundant.

Where the employer proposes to make 20 or more employees redundant, it must hold a consultation period with those employees or recognised trade union representatives for a minimum of 30 days.

Where the employer proposes to make 100 or more employees redundant, the consultation period must be a minimum of 45 days.

The employer must conduct a meaningful consultation and redundancy should be the last resort. The employer should make efforts to identify any suitable alternative roles for those employees at risk of redundancy. Equally, if an employee refused a suitable alternative role, this may negate his or her entitlement to a redundancy payment.

Typically, your company's redundancy process should be outlined in your contract or staff handbook. If it not, your employer has an obligation to ensure that you understand the process. A redundancy process should outline the following:

  • How employees will be chosen for redundancy
  • How long the decision will take
  • What meetings you can go to and when they will be
  • How to appeal the redundancy process

Redundancy payments

If the employer confirms that an employee is to be made redundant, the employee is entitled to a redundancy payment providing they have been continuously employed for two years or more.

The employee should first check their contract of employment to see whether there is an agreed method for calculating a redundancy payment. This is called a "contractual redundancy payment".

If the contract of employment is silent of redundancy payments, the employee will be entitled to a payment set by the Government. This is called a “statutory redundancy payment”.

What are statutory redundancy payments?

Statutory redundancy payments are payments set by the Government and are currently set as follows:

  • 1.5 weeks gross pay for each complete year of continues employment in which the employee was aged 41 or over
  • 1-week gross pay for each complete year of continues employment in which the employee was aged 22 or over
  • 0.5 weeks gross pay for each complete year of continues employment for each earlier year

It is worth noting that there is a cap on how much statutory redundancy will pay out. In England and Wales, the current maximum (correct as of February 2020) is £15,750 regardless of your length of service and your salary level.

Unfair dismissal – redundancy advice

An employer cannot unfairly dismiss an employee even when the employee has been dismissed on the grounds of redundancy.

This can occur where an employee does not believe that the redundancy situation was genuine and that their job is still required by the employer. This may also occur where the employer has followed an unfair procedure; i.e. there may have been an unfair element to the selection criteria. A dismissal by way of redundancy may also be unfair where the employer failed to properly consult the affected employees.

Other reasons where your redundancy could have been unfair include:

Your employer does not meet you individually or only meets you to tell you they are making you redundant (If you have worked for your current employer for two years or more)

  • You have not been given enough information about the process
  • The process was not followed as it should have been
  • Your redundancy selection is a result of some form of discrimination (i.e. maternity, age, gender or race discrimination)

Redundancy law unfair – case study

The claimant had been employed by a company as a client relationship executive. The company restructured and the work performed by client relationship executives was reorganised and the company alleged, was removed. The claimant was made redundant as a result of this.

We assisted the claimant in issuing a claim for unfair dismissal on the basis that the work she was conducting was still being done by the company. The claimant received a substantial sum which compensated her for loss of earnings as a result of the dismissal.

What should I do next?

If you would like advice regarding redundancy, our specialists and will be happy to discuss your case with you. We appreciate that this is often a difficult time for you, and we have a range of funding options available to help. In some circumstances, we may be able to offer a 'no win no fee arrangement' to you.

Redundancy advice FAQs

When can I be made redundant?

An employer may dismiss an employee on the grounds of redundancy. This typically happens in three scenarios:

  • Where the employer’s business is closing entirely
  • Where the place an employee works is to be relocated
  • Where the specific work than an employee carries out is no longer required

What is a reasonable redundancy package?

Your employer must provide redundancy pay as follows: 1.5 weeks' pay for each full year worked from age 41; 1 weeks’ pay for each full year worked between ages 22 and 40 and half a weeks’ pay for each year worked between ages 17 and 21, ensuring fair compensation. In certain circumstances, by engaging a specialist employment solicitor they may be able to negotiate a more favourable redundancy package on your behalf.

Should you accept the first redundancy offer?

If redundancy seems likely, negotiating a settlement agreement can be beneficial. You will generally receive more money than with a standard redundancy payment, and can often negotiate a good reference as part of the settlement. Additionally, employers often contribute to your legal costs, making this option financially and professionally advantageous.

How to appeal redundancy?

It may be possible for you to submit a redundancy appeal if you think you were unfairly selected or your employer did not follow a fair process. There is no set process to appeal for redundancy; each organisation may have its own appeals process or, if your employer does not have one, then you can write a redundancy appeal letter.

Once you have either sent the letter or discussed with your employer why you think your redundancy is unfair, the employer can accept or reject your appeal. Appealing your redundancy does not affect any of your redundancy rights.

If you are not satisfied with your employer’s decision, then you can take your claim to an employment tribunal. If you wish to challenge your employer, we recommend having an employment lawyer at your side; contact our expert redundancy solicitors today and we can help you determine if you have a case or guide you through the process. Contact us today.

How do you fight against redundancy?

Your employer should consult with you as part of any fair redundancy process. During that consultation period it is your opportunity to suggest alternatives to redundancy. If you are made redundant, you should be reminded of your right to appeal. If not, you can still write to them, outlining why you believe the redundancy is unfair. Clearly state your reasons and provide any supporting evidence to strengthen your case.

Is it worth fighting redundancy?

When confronting redundancy, consider negotiating a more favourable severance package, particularly if you believe you have been unfairly targeted. If the standard offer does not reflect your situation adequately, advocating for better terms, or instructing a specialist employment solicitor, can lead to a more equitable outcome.

You are facing a potential redundancy situation – do you need a solicitor?

If you are at risk of redundancy, you should consider consulting a specialist employment solicitor. They can advise you on what a fair and reasonable redundancy process should look like, ensure the redundancy payments you receive are correct and can assist with potential claims where necessary. Additionally, they may be able to provide strategies to potentially save your job and protect your rights.

Can you refuse to accept a new role?

If your employer identifies a suitable alternative role for you and you unreasonably refuse to accept that role, you may forfeit your entitlement to a statutory redundancy payment. However, you can make a claim to an employment tribunal if you think the job you were offered was not suitable.

Can you sue for unfair redundancy?

Yes, you can potentially file a claim for unfair dismissal in an employment tribunal if you believe a genuine redundancy situation did not exist, you were unfairly selected, your employer did not adhere to a fair process, or if genuine and meaningful consultation was not conducted before redundancies were made. This legal recourse offers a route to address unjust redundancy situations.

What is a sham redundancy?

A sham redundancy refers to a situation where a business falsely claims a redundancy to conceal unjust or discriminatory motives. When challenging a redundancy dismissal, the initial inquiry should focus on determining if a legitimate redundancy scenario existed, as some employers exploit the concept to mask improper intentions.

Why do I need a solicitor for voluntary redundancy?

Having a solicitor for voluntary redundancy ensures compliance with legal requirements, particularly where a settlement agreement is being used as this mandates independent legal advice. Solicitors help you comprehend contract terms fully, especially those restricting future actions against the employer. Their guidance safeguards your rights and ensures fair treatment throughout the voluntary redundancy process.

What is the 4-week rule for redundancy?

The 4-week redundancy rule stipulates that if you remain in a new role beyond a 4-week trial period, you forfeit redundancy rights, unless an extended trial period was mutually agreed upon. However, during this period, if the new role proves unsuitable, you can resign without additional notice and this will not affect your employment rights, including your right to statutory redundancy pay.

How can I maximise my redundancy payout?

  1. Outline your goals clearly
  2. Review your employment contract thoroughly
  3. Familiarise yourself with your employer's redundancy procedures
  4. Strategise your negotiation approach
  5. Prioritise negotiating financial terms whenever possible
  6. Maintain clarity and courtesy during negotiations
  7. Document meetings diligently, or at least ensure your employer does so
  8. Conduct thorough research on redundancy practices and payouts
  9. Seek insights from colleagues who have navigated similar situations
  10. Consider consulting a solicitor for legal guidance

How much notice does an employer have to give for redundancy in the UK?

In the UK, statutory redundancy notice periods vary based on employment duration. Employers must provide at least one weeks’ notice for staff with one month to two years of service. For those employed between two and 12 years, it is one week per year, and for 12 years or more, there is a mandatory 12 weeks' notice (which is capped at 12 weeks).

Can I be made redundant if my job still exists?

No, typically you cannot be made redundant if your job still exists. However, the determination of whether a job still exists can be complex. Employers must act reasonably; redundancy is permissible if your role is genuinely unnecessary, and your skills are no longer required.

  • Guide to redundancy

    Trainee solicitor Lucy Bishop introduces employment law solicitor Stephen Woodhouse. 

    Stephen gives an overview of his roles within the team and the kind of cases he handles. Stephen provides a guide to the redundancy process, explaining why this might happen, the rules around the consultation process and how if the rules aren't followed correctly this could lead to unfair dismissal claims.

    Stephen also provides some tips for employees facing redundancy and explains why early advice is crucial if you are an employer who is considering making staff redundant.

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