Redundancy

Sadly, employers are sometimes faced with the possibility of having to make staff redundant. For example, your committee or board might be forced to consider this if the organisation is having to close down or they do not have enough funding to keep paying staff. 

Your board or committee is legally required to use a fair and objective way of selecting people to make redundant. If they are looking at the possibility of having to make less than twenty employees redundant, each employee should be given an individual consultation. 

You should also try and consider alternatives. Can the employee be offered an alternative position? Employees who have worked for you for at least 2 years will have a right to statutory redundancy pay based on their weekly pay, age and continuous employment with you.

Employees are entitled to statutory redundancy pay if they’ve been working for you for 2 years or more. 

They can get:

• half a week’s pay for each full year they were under 22

• one week’s pay for each full year they were 22 or older, but under 41

• one and half week’s pay for each full year they were 41 or older

Length of service is capped at 20 years, and their weekly pay is the average they earned per week over the last 12 weeks before the day you gave them their statutory notice.

Employees are not entitled to statutory redundancy pay it you offer to keep them on or if you offer them a suitable alternative work which they refuse without good reason.

Employees are not entitled to statutory redundancy pay if they fall into one or more of the following categories:

• former registered dock workers and share fishermen

• crown servant, members of the armed forces or police services

• apprentices who are not employees at the end of their training

• a domestic servant who is a member of the employer’s immediate family

Redundancy Notice Periods

Once you have selected the employees you intend to make redundant, you must give them notice before their employment ends. The statutory redundancy notice periods are:

• at least one week’s notice if they 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

However, you may have set out longer notice periods in your contracts on employment, so this will also have to be checked.

In some cases, a payment in lieu of notice clause may be include in an organisations employment contracts. This means that as an employer, you can end an employment contract with no notice, but you must give payment for all of the pay they would have received during the notice period.