redundancy
📖 What is redundancy? Meaning and definition
Redundancy is a specific type of dismissal from employment that can happen when a business's needs change. For example, if a client business no longer requires services from a company, that company might no longer need the employees who provided those services, leading to redundancy. Employees who are made redundant may be entitled to a 'Redundancy Payment'.
Claims for a redundancy payment are heard by an Employment Tribunal. If an employer does not participate in the hearing, the Tribunal can still award sums to the claimant. However, a claim for a redundancy payment can fail if the claimant does not follow the correct procedure, such as notifying Acas for early conciliation before presenting their claim.
It's important to understand that a claim for a redundancy payment is distinct from other claims like arrears of pay, notice pay, holiday pay, or breach of contract, although these might sometimes be claimed together. If a redundancy claim is dismissed due to a procedural error, like not notifying Acas, the claimant might still be able to present another claim if they follow the correct steps and make a claim in writing to their employer within a specific timeframe.
📋 Requirements
- The employer's need for employees to do work of a particular kind has ceased or diminished.
- The employee was dismissed due to this cessation or diminution of work.
- The claimant must notify Acas for early conciliation before presenting a claim to an Employment Tribunal.
📝 Procedure
- The employee is made redundant by their employer.
- The employee makes a claim for a redundancy payment in writing to their employer within six months of employment termination.
- The employee notifies Acas for early conciliation.
- The employee presents a claim for a redundancy payment to an Employment Tribunal.
💡 Examples
- Cleaners were made redundant by their employer after a client business experienced a downturn in work and no longer needed their services.
- An employee sought a redundancy payment after their employment ended, but their claim was dismissed because they did not first notify Acas for early conciliation.
- An Employment Tribunal awarded a redundancy payment to a claimant even though the employer did not participate in the hearing.
📚 Legal basis
- Employment Rights Act 1996
❓ Frequently asked questions
What is a redundancy payment?
A redundancy payment is a sum of money an employee may be entitled to receive if they are dismissed due to redundancy, as seen in cases where Employment Tribunals award such payments.
Can I claim a redundancy payment if my employer is in liquidation?
Yes, claims for a redundancy payment can be made even if the employer is in liquidation, as indicated by cases where the Secretary of State for Business and Trade is involved as a respondent.
What happens if I don't notify Acas before making a redundancy claim?
Your claim for a redundancy payment may be dismissed or struck out by the Employment Tribunal if you do not notify Acas for early conciliation before presenting your claim.
Can I make a new redundancy claim if my first one was dismissed for a procedural error?
Yes, if your claim was dismissed for not notifying Acas, you are not prevented from notifying Acas and then presenting another claim, provided you made a claim in writing to your employer within six months of your employment ending.
Is a redundancy payment the same as notice pay or holiday pay?
No, a redundancy payment is distinct from arrears of pay, notice pay, and holiday pay, although these different types of payments might be claimed together in an Employment Tribunal.
What if my employer doesn't attend the Employment Tribunal hearing?
An Employment Tribunal can still proceed with the hearing and award sums, including redundancy payments, even if the employer does not attend, as long as they were notified of the hearing.