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4 things to consider if you've been made redundant

10 Jul 14:00 by Adam Pyle

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Redundancy is hard on anyone, no matter what the circumstances, but it doesn’t mean that you can’t turn the situation around; you just need to know what you can do. Here are four things you simply must consider if you have been made redundant.

Understand that you have rights.

There are essentially only three reasons why redundancy happens: the business closes, your workplace closes or there is a reduced need for employees to do the available work. These could happen if the business suffers from reduced demand or it has been taken over and then restructured. Reduced demand and supply is at the crux of the rapid shock that has come through Covid-19, with roughly 20% of usual economic activity just not happening - a larger shock than the great depression.

If your redundancy doesn’t appear to fall into any of these categories, it might be a case of unfair dismissal.

To bring a claim for unfair dismissal, you will need to have been employed by your employer for 2 years or more. Your employer needs to have shown you both a fair reason for your redundancy and have followed a fair process during it. Your role cannot be redundant if they hire someone else to do the same job, nor can your employer simply make you redundant on the spot, with no prior warning.

Indeed, your employer should:

  • Warn you that redundancy is a possibility
  • Where there is more than one employee doing the same role, decide on fair criteria to select who should be made redundant and score employees fairly
  • Discuss/consult with you your scores and/or the reason for the redundancy
  • Consider and discuss any alternative employment that is available.

If you do not agree with the reason you have been given for the redundancy, don’t think your scores are right or if you believe you should have been considered for alternative work, you should raise this with your employer as part of the consultation or any appeal process.

Whilst unfair dismissal means you are only eligible after two years of employment, no employee, of any length of time, should be discriminated against. If you are made redundant because you are a protected characteristic, you can bring a discrimination claim. If, for example, you being pregnant or having a disability that has caused you to get low scores in the redundancy process and caused you to lose your job as a result, this can be challenged.

You are also entitled to a notice period (or payment to represent this – i.e. payment in lieu) before your employment ends. This will be one week’s notice for each year of employment up to a maximum of 12 weeks or what your employment contract says (whichever is the higher).

You should also be paid for any holiday that you have built up that year but not taken.

Make sure you’re getting the right amount of money

A statutory redundancy payment is something you are entitled to only if you have worked for the organisation for two years of more. The statutory payment is:

  • Half a week’s pay for each full year of service under the age of 22
  • 1 week’s pay for each full year of service between the age of 22 and 41
  • 1.5 weeks of pay for each full year of service aged over 41

A week’s pay is set at a certain amount that usually increases each April. It is currently £489. If you earn less than this, your redundancy payment will be based on your actual weekly pay. Anything you earn above the cap will not be taken into account. In addition, a statutory redundancy payment can only be based on up to 20 years of employment even if you have been employed for longer than this.

It's worth noting that some employers pay more, especially in regards to voluntary redundancy. It's always worth checking your contract and, if redundancy has not been mentioned but you know times are tough and can afford to retire or wait it out, it might be worth broaching the subject with your employers about voluntary redunancy; they can offer more in these circumstances.

Check to see if you can claim any benefits

Any financial difficulties can be slightly offset by seeing what benefits you can claim. There is a stigma around this but benefits exist, or are meant to exist, as a safety net for difficult times and if you can offset costs that will stress you out whilst you are searching for a next job, please look in to this as a matter of urgency. It will also be the safety net that allows you to apply for your new job.

What do I need?

As a start, any and all inessential expenditure should be looked at; and you will have to be very strict in your definition of what this is; it's likely that Wi-Fi must be considered essential now but, whilst you can't say the same of Netflix, you will need ways to switch off from the job hunt. If you have a mortgage, tell your bank, because they will favour those who proactively come to them with potential problems, rather than addressing it when the problem arises. This is true of all standing order providers who may need to be aware of your change in circumstances.

You should also get advice on any company pension you have and whether you can remain with the same provider, add a lump sum from your redundancy payment or transfer your money to a new scheme. Look in to all the benefits your company provides - life insurance for example - and set yourself up to replace them.

 

If you have done everything you need to do, find your next role at CIM Marketing Jobs.