Redundancies, Lay-off and Short-time working

With current struggles in the financial market, many businesses are looking to make cut-backs in order to remain solvent. Unfortunately, this often means cutting back on staffing costs, which can be done through redundancy, lay-offs and short-time working.

Forbes Solicitors offer a bespoke service to those with issues relating to redundancies and can advise you every step of the way, easing stress and resolving the matter with your best interests at heart.

Redundancy

A redundancy situation arises where an employer's need for employees to:

  • carry out the business they are employed for;
  • carry out business in the place where they are employed; or
  • carry out work of a particular kind has ceased or diminished, or is expected to cease or diminish.

Employers must follow a fair procedure and consider whether any alternatives to redundancy may be available. Employers should also consider whether suitable alternative employment can be offered to a redundant employee.

Employees have a right not to be unfairly selected for redundancy and a clear procedure must be applied consistently, in order for the procedure to be fair for all workers. If an employee believes that their redundancy was unfair, they may be able to make an unfair dismissal claim to the Employment Tribunal.

An employee who has more than two years' continuous service will be entitled to a statutory redundancy payment. This is calculated using a statutory formula, which takes into account the employee's age, length of service and gross weekly pay.

Layoffs

When employees are not provided with work by their employer and the situation is expected to be temporary, they are regarded as being 'laid off'.

In order to be lawful, lay-offs must either be contractually agreed (whether with the employee in their contract of employment or with a relevant trade union) or implied from custom and practice over a long period of time.

Employees can be laid off without pay where there is a specific term in their contract allowing this to happen.

When employees are laid off, they may be entitled to a statutory guarantee payment from the employer. Payment is limited to a maximum of five days in any period of three months and the daily amount is subject to an upper limit which is reviewed annually.

Short-time working

Short-time working occurs when employees are laid off for a number of contractual days each week, or for a number of hours during a working day.

As in the case of a lay-off, the employer must have an express or implied power in order lawfully to reduce an employee's pay in these circumstances.

If you would like more information or advice on redundancies, layoffs or short time working, please contact our Employment team on freephone 0800 689 0831 or by email.

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Employment & HR

16 Mar 2017

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