COVID-19 REDUNDANCY FACT SHEET
- During the Covid-19 pandemic you may have to make staff redundant due to the ongoing economic impact, although these are exceptional times normal employment rules remain in place.
- This means that if you dismiss staff you will still have to comply with the Employment Rights Act 1996 and the rules regarding redundancy and redundancy payments.
- Other employment legislation such as the Equality Act 2010 will also apply and may be relevant to your decision to dismiss employees due to the Covid-19 pandemic.
- Employees who have been employed for more than 2 years have the right not to be unfairly dismissed and the right to receive a redundancy payment if dismissed for redundancy.
- Although an employees with less than two years service may not have protection from unfair dismissal it may still be a good idea to put them through a formal process.
- You should consider taking legal advice before making employees redundant.
Fairness
- Redundancy is a potentially fair reason for dismissal as long as the procedure and the decision as to who to select is fair.
- Redundancy means that there is a reduction in the type of work that the employee is employed to do or a reduction in the need for the number of employees.
- Employees who are at risk of redundancy should be given warning that they are at risk, this may be difficult in the current circumstances, but should still be attempted.
- Employees who are at risk of redundancy should be consulted about the redundancy, this may also be difficult, but employers should consider consultation via telephone, video conference or in writing.
- Employers should consider ways of avoiding redundancy, this may involve moving to alternative work or using the Coronavinus Jobs Retention scheme, furloughing employees, with the government contributing to their salary (see Covid-19 Furloughing Staff Factsheet).
- It may not be appropriate to furlough employees and instead to make them redundant (and therefore not unfair dismissal) if it is already clear that after the end of the furlough period there will not be work for them.
Procedure
- An employer should produce a fair method of selection if for example it does not need to make redundant all of the employees doing a particular role and only needs to reduce the number of employees employed to do that role.
- If an employee is being invited to a meeting where they may be dismissed they should be warned that this is a possibility and allowed to be accompanied by a work colleague or a trade union representative.
- This will be difficult in current circumstances but thought should be given to videoconferencing or teleconferencing.
- If an employer makes any employees redundant they should offer them a chance to appeal the decision to dismiss.
Discrimination
- An employer may discriminate against an employee if they select them for redundancy due to something related to Covid-10, for example an employee who is in a high risk group may want to shield in line with public health advice rather than come to work, if they are disabled it may be discriminatory to select them for redundancy.
Payment
- An employee who has more than two years service and dismissed for redundancy is entitled to a redundancy payment.
- This is calculated on the basis of a mixture of age and length of service.
- The government have produced an online calculator https://www.gov.uk/calculate-your-redundancy-pay
- The employee will also be entitled to their notice pay and accrued but untaken holiday pay.
Do you need redundancy advice? Our Employment Lawyers can guide you through the redundancy process and provide expert legal advice at an affordable fixed fee, for more information see our Fixed Fee Employment Law Compliance Service.
The contents of this article do not constitute legal advice and are provided for general information purposes only.
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