

5 Essential Tips on Setting Up a Business in the UK
With 801,000 new businesses launching in the UK between 2022-23, setting up for success is more important than…
Whether you’re facing redundancy or carrying out redundancies, our solicitors will ensure the process is fair.
Redundancies can be a blessing or a curse and it’s important to understand exactly what you can and cannot say or do during the process. Whether you’re looking to negotiate your settlement, or just need independent legal advice, our employment team are here to help.
FAQs
Before outlining the correct redundancy process, employers and employees alike need to understand what redundancy means.
Redundancy is when an employee is dismissed because the company no longer needs anyone to do their job. There are various motives behind companies making redundancies.
Some of the primary examples are because your company is:
When an employer makes an employee redundant, the employer must demonstrate that the job will no longer exist.
Redundancy pay will depend on the employee’s annual salary (before tax) and the number of years worked at the company.
If an employee has been working for the company for at least two years, then for each full year, the company owes:
Age | Entitled Pay |
---|---|
Under 22 | Half a week’s pay |
22 – 40 | One week’s pay |
41 plus | One and a half week’s pay |
Statutory redundancy pay comes with terms and conditions, which include:
Example:
Chris (aged 25) has worked at an accountancy firm for five years, earning £400 a week. Unfortunately, Chris has just been made redundant, and his pay is as follows:
Overall, Chris will receive a statutory payment of £1,600. However, this payment excludes any contractual pay.
Redundancy tax is payable after the first £30,000. This figure may sound unlikely, but other factors are calculated in redundancy pay which include:
Tax is applicable on any portion of redundancy pay above the value of £30,000. The tax rate for any value above £30,000 is the same as the other salary.
Holiday pay and Pay In Leiu Of Notice will be treated as other payments rather than redundancy pay as they’re both paying for work rather than compensation for job loss.
When it comes to how redundancy works, there are five stages employers must take to ensure the redundancy is fair. These five stages are as follows:
If an employer doesn’t carry out the correct processes, they could end up with an employment claim for unfair or wrongful dismissal.
For more information on how redundancy works, please contact our solicitors directly on 0203 007 5500.
If an employer hasn’t completed the correct redundancy procedure, an employee can contest the redundancy.
Dealing with redundancy-related employment claims is a complex process that requires the help of a specialist employment law solicitor.
If you need help with a claim, you can contact our solicitors directly on 0203 007 5500.
It is illegal to make an employee redundant because they are on maternity leave or sick leave.
But, you can make employees redundant for fair and valid reasons if they are on maternity leave or sick leave.
For example, Frank has been on long-term sick leave for 4 weeks from his job as a grocery picker at a warehouse. His employer has followed all of the correct procedures for his sick leave. But they are now making all grocery pickers redundant because they have implemented the use of machinery. They followed all correct redundancy procedures.
In this case, the employer is removing that role from the company as a whole and has not made him redundant because of his sick leave.
Navigating redundancies for employees on maternity leave or sick leave can be very complex, so it’s important to consult a solicitor early on in the process to ensure all processes are carried out legally and fairly.
If you need help clarifying whether a redundancy is legal, you can contact our solicitors directly on 0203 007 5500.
Call, email or provide us with a few details of your matter, and we’ll help you arrange an initial consultation. You’ll get:
No fee surprises. Ever. Our solicitors in London and Brighton will inform you from the outset how much your case will cost and we will do everything in our power to keep costs down and within your original fee estimate.
You are our priority and law is our speciality. Our award-winning solicitors in London and Brighton ensure you know exactly where you stand from a legal perspective so you can make a well-informed decision.
With fortnightly updates on your case, you’ll never be left in the dark. Our solicitors in London and Brighton ensure you know exactly how your case is progressing and are with you every step of the way.
What we do
Our untimed initial consultations provide you with as long as you need to speak to a specialist solicitor about your matter.