Redundancy

Everything about redundancies (and restructures)

A redundancy arises where the business no longer requires work of a particular kind to be performed. Generally, this arises because the need for that kind of work has reduced (diminished).  

A redundancy is a dismissal. Therefore, for it to be a fair dismissal (and avoid a claim for unfair dismissal) it must fall within the definition of redundancy and a full and fair procedure must be carried out. 

In this section we look at the definition of redundancy and the redundancy process including, selection criteria, consultation and redundancy payments. We also discuss collective redundancy i.e. where there are more than 20 redundancies being considered where collective consultation and further procedure are required.

Redundancy can also be part of an overall restructure in a business. It is possible to be making redundancies in one area and recruiting in another.  

Frequently asked questions

You cannot make an employee redundant because they are pregnant as this would count as automatic unfair dismissal and discrimination. However if you have a genuine redundancy situation and there is no suitable alternative work available for them, then you could lawfully make the individual redundant providing that you have followed the correct redundancy procedures. It is also worth noting that the pregnant employee may still qualify to receive maternity pay even if she is made redundant. 

Employees with at least 2 years' service will be entitled to Statutory Redundancy Pay (SRP) which is calculated based on the employee's age and length of service. Please see our redundancy pay guidance for more information.

You will need to give the employee notice in accordance with their contract of employment (or statutory notice, whichever is the greater - see notice guidance) and any accrued and untaken holiday entitlement (calculated up to the date of termination).

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