If you’re faced with redundancy, your employer must treat you fairly and act in accordance with your contract and legal redundancy rights. That includes making sure you’re consulted, following the right selection process and giving you a proper notice period. If not, then you could have a claim for unfair dismissal, or claim compensation for lack of consultation.
- Your right to a fair process
- Your right to a minimum notice period
- Your right to consultation
- Types of consultation needed and relevant time frames
- Your right to time off to look for work
- Leaving your job early
- Last day checklist
- For more help
Your right to a fair process
Redundancy happens when your job disappears. It is not the same thing as being dismissed from your job for other reasons
Your employer must use a fair and objective way of selecting job roles to make redundant, and tell you what it is.
If you think you’ve been selected unfairly (say, on the grounds of age, race or gender), or your employer has acted unfairly in other ways, you can normally appeal.
If you’re still not satisfied you can take your employer to a tribunal.
Your right to a minimum notice period
Make sure you check your contract of employment, as it might state that you’re entitled to longer notice periods.
A notice period is the amount of time between when your employer tells you that you will be made redundant and your last working day.
According to redundancy law, you’re entitled to a minimum notice period of:
- 12 weeks’ notice if employed for 12 years or more.
- 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.
Pay in lieu of notice
If your employer doesn’t want you to work your notice period they can offer you a lump sum instead – called pay in lieu of notice.
Pay in lieu of notice is taxed in the same way as your ordinary pay.
Gardening leave (garden leave)
You might be asked to serve out your redundancy notice away from work.
This is known as ‘gardening leave’ and it means that, although you’re not actually working, you’re still legally employed and will receive your normal salary and benefits but:
- You have to stick to the rules of your contract.
- You might be called back to work if you’re needed.
- You can’t start a job with a new employer.
Compromise agreements
If your employer has not followed a fair procedure in selecting you for redundancy, they might sometimes ask you to sign an agreement stating that you’ll not go to an employment tribunal (often in return for an extra payment).
This is known as a ‘compromise agreement’.
Your employer must pay for you to receive independent legal advice so you fully understand the rights you’re giving up.
Your right to consultation
Employers always have to consult with employees before dismissing them on the grounds of redundancy.
In short, your employer must tell you what’s going on and give you a chance to ask questions and raise objections.
As part of the consultation process, employers have to:
- Consider alternatives to redundancy.
- Look at ways to reduce the numbers of redundancies.
- Look at how they can reduce resulting hardship.
The process your employer has to follow will depend on the number of redundancies planned.
Types of consultation needed and relevant time frames
| Number of employees to be made redundant | Type of consultation needed | Timing of consultation |
|---|---|---|
| Less than 20 employees | Your employer needs to consult with you individually only. | Within a reasonable time |
| 20–99 employees | Your employer must carry out collective consultation. This means consulting with your union rep if there is one or, if no union rep, with your elected employee representative(s). It’s good practice for them to consult with you all individually too. If the employees decide not to elect a representative, then consultation will be with individuals only. |
30 days before first dismissal |
| 100+ employees | Your employer must carry out collective consultation. This means consulting with your union rep if there is one or, if no union rep, with your elected employee representative(s). It’s good practice for them to consult with you all individually too. If the employees decide not to elect a representative, then consultation will be with individuals only. |
45 days before first dismissal |
Individual consultation
Your employer should arrange a meeting with you to explain what is happening and why.
- You can ask to be accompanied by a trade union or employee representative.
- You can raise objections and suggest alternatives to redundancy, for example alternative work, short-time working or lay-offs.
- Your employer considers your objections and, if they decide to go ahead with redundancy, they must confirm this to you in writing.
- Most employers will allow you the right to appeal if you’re unhappy with the decision, but if your employer does not offer an internal appeals procedure you can consider going to a tribunal.
- If your dismissal is, or seems, unfair and you’ve decided to sign a ‘compromise agreement’ you do this once the discussions with your employer are over.
Collective consultation
According to redundancy law, if 20 or more employees are going to be made redundant, the consultation process is more structured and must involve trade union or employee representatives.
What happens after the consultation?
- You receive redundancy notice.
- You must be given at least the statutory notice period – 1-12 weeks depending on how long you’ve been in the job.
- However, if you’re taking ‘gardening leave’ you will normally leave work as soon as you get your redundancy notice.
- You are entitled to paid time off – usually two days – to look for work and also a reasonable amount of unpaid leave for job search and training.
- Job ends.
Your right to time off to look for work
You’re entitled to paid time off to look for work or undergo training. The amount of time you can take has to be reasonable.
If you’ve worked continuously for your employer for at least two years they have to pay you up to 40% of a week’s pay to cover your time off.
For example, if you work a five-day week you can take two days off in total to attend interviews and your employer will have to pay you for this time.
If you take any more time off than this, they don’t have to pay you for it.
Some employers are more generous so it’s worth discussing it with them.
Leaving your job early
If you’re offered a job and your new employer wants you to start before your redundancy notice ends, speak to your employer and see if you can leave early without losing your redundancy pay.
Put your request to leave early to your employer in writing saying when you want to leave.
If you leave early without your employer’s permission, you could lose some or all of your redundancy pay.
Last day checklist
On your last day at work you should receive the following:
- Details of your pension
- Job references from your employer
- A latter stating the date of your redundancy
- Your P45 (to give to your new employer so you’re taxed correctly)
- Any redundancy pay, wages, holiday pay and other money due to you
- A written statement showing how your redundancy pay has been calculated
For more help
Acas offers free, confidential and impartial advice on all employment rights issues in England, Scotland and Wales.
The Labour Relations Agency provides an impartial and confidential employment relations service in Northern Ireland.
This article is provided by the Money Advice Service.
