What is dismissal?
If your worker is to be entitled to a redundancy payment, he or she must have been dismissed by you rather than left your employment by choice. The reason for the dismissal must be redundancy.
Should your employee be on a fixed term contract, which ends without renewal, this is considered dismissal and he or she may qualify for a redundancy payment.
Your Personal Assistant who has been given notice of redundancy may still leave early by agreement with you and still be entitled to receive payment. The minimum period of notice by law is one week for every complete year worked, up to a maximum of 12 weeks.
What is Redundancy?
Redundancy means that you have dismissed an employee because of a need to reduce the number of staff that you have working for you. In this situation you are required to give your employee notice of redundancy and, if applicable, make redundancy payments.
You may not make a worker redundant and then employ someone else to do the same job. By making an employee redundant, you are implying that his or her job no longer exists. If you make an employee redundant and try to recruit a replacement, you risk being taken to an industrial tribunal for unfair dismissal.
When must I make Redundancy Payments?
You must make redundancy payments when you make an employee redundant who has worked for you for at least two years since the age of eighteen. He or she will need to meet other conditions that are discussed later in this information sheet.
Who qualifies for Payment?
Only people working under a contract of employment are entitled to receive redundancy payments. A contract exists in law as soon as an employee starts work. It can be written or verbal, be fixed term or last for any period of time.
Who will not be entitled to Redundancy?
Self-employed people may not be offered redundancy. Employees who are members of your immediate family working in your home are entitled to redundancy payments if they meet the qualifying criteria (see below).
Are there any rules on length of service?
Your worker must have at least two years continuous service working for you before he or she qualifies for redundancy payments.
How do I work out my employee’s length of service?
For the purposes of redundancy payments, the maximum length of service that can be taken into account is twenty years. The length of continuous service is normally counted backwards from the date on which your employee’s notice ends. If you have given less than the legally required notice, the extra notice your worker should have received will be added on.
If your Personal Assistant was absent for certain reasons, for example, illness, pregnancy or temporary shortage of work, these absences can still count towards continuous employment whether or not his or her employment contract was suspended.
What is Statutory Redundancy Pay?
The amount of statutory redundancy payments depends on: how long your worker has been employed by you, your worker’s age and weekly pay.
Statutory redundancy pay is worked out as follows:-
- ½ week’s pay for each complete year of employment when your workers were aged under 22.
- 1 week’s pay for each complete year of employment when your workers were between 22-40 years old.
- 1½ week’s pay for each complete year of employment when your employees were over 41 years of age.
The maximum number of years of employment that can count is 20. Employment is counted up to the relevant date, which is the date your employee’s notice expires. If you have not given your worker any notice, it is the date on which the notice would have expired had they been given it.
What is a week’s pay?
A week’s pay is considered to be the basic pay that your worker would normally receive in a week. This is calculated, for the purposes of redundancy payments, without taking over-time into account.
The calculation date for your worker’s redundancy payment will normally be one of the following:
- The day that you give your worker his or her redundancy notice. The minimum legal notice is one week for each year of service up to a maximum of twelve weeks.
- If the notice you gave is longer than the minimum required by law, the calculation date is the date on which minimum notice would have needed to have been given to stop your worker’s employment on the same day as it actually ceased; or
- The day your employee’s job ended if you had not given the appropriate notice.
There is a maximum limit on the amount that must count as a week’s pay. This applies even if your worker earned more than the maximum amount. The current maximum weekly pay for 2010 is £380 per week.
What if I or my worker dies?
If at the time of your death you are employing Personal Assistants, your estate may be liable to make redundancy payments. In the event of an employee who is waiting for a redundancy payment dying before he or she receives it, the payment should be made to his or her personal representative.
How will disagreements about Redundancy be dealt with?
Disputes regarding redundancy payments can be dealt with through industrial tribunals, but it would be preferable to try to resolve any disagreements before they would get to a tribunal.
It is highly recommended that you contact your regional office of Centre for Independent Living NI, the Labour Relations Agency (details below) or the Employer's 24 Helpline (connected to the insurance company providing you with employer's insurance) if you are considering making any staff redundant. It is imperative that you contact one of the above organisations before mentioning or discussing redundancy to any member of your staff.
At the end of this information sheet you will find for information a Specimen Redundancy Policy and Procedure prepared by the Labour Relations Agency in December 2010.
Where can I get further help?
If you need further information on redundancy, dismissal or statutory redundancy payments, please contact us
Labour Relations Agency
2-8 Gordon Street
Belfast BT1 2LG
Specimen Redundancy Policy and Procedure
- The employer recognises that security of employment is one of the prime needs for working life and, in furtherance of this, the employer will take all reasonable steps to prevent the occurrence of redundancy.
- Nevertheless, in a period of uncertain economic conditions, the possibility of redundancy cannot be eliminated, although this will only be adopted when all other feasible measures have been fully explored.
- This policy/procedure applies to all employees were the employer is proposing less than 20 redundancies.
- Separate collective redundancy arrangements apply when the employer is proposing 20 or more redundancies.
- When it becomes evident that there is likely to be a surplus of staff in any given category, or when economic conditions necessitate a reduction of employees, a redundancy situation will not be declared until the measures set out in the section headed "Measures to Avoid or Minimise Redundancy" have been considered.
- Meaningful consultation with individual employees will begin in good time, once the employer is aware that there is a redundancy situation.
Measures to Avoid or Minimise Redundancy
- The employer will consider the feasibility of one or more of the following measures to avoid or minimise the number of redundancies; subject always to the paramount need to ensure the efficient and effective running of the organisation.
- natural wastage (e.g. an employee was due to leave to go to another job or retire);
- restrictions on recruitment;
- retraining and redeployment;
- reduction or elimination of overtime;
- introduction a short-time working on temporary lay-off (Where this is provided for in the Contract of Employment/Written Statement of Main Terms and Conditions of Employment or by an agreed variation of its terms);
- seeking applicants for voluntary redundancy; or
- agreed variation to working hours (on a short-term or permanent basis) and if the party providing funds for the employment agrees to such changes.
- The employer will consider any other possible measures which employees might suggest to avoid or minimise redundancies.
Selection for Redundancy
- If redundancy is still necessary after all the measures referred to above have been fully explored, the employer will identify and informed staff of the number and category of employees that may be affected.
- Selection of employees for redundancy will normally take place in the following order, subject to the employer reserving the right to retain any employees with specific skills/specialised training, it considered essential to the efficiency/stability of the employer's support.
- Employees who are accepted as volunteers. (The employer reserves the right to nominate the type of employee eligible to volunteer for redundancy and to accept or reject applications for voluntary redundancy bearing in mind costs, skills loss, efficiency or other appropriate considerations.)
- In the event of the measures taken above proving insufficient, then the employer will select employees for redundancy based on objective factors such as job performance records, conduct records, attendance records and records of particular skills and abilities. Due weight will be attached to the factors used in reaching a balanced decision on each case.
- The employer will set out in writing the circumstances which have led to contemplation of dismissal by reason of redundancy and invite the employee to discuss this at a meeting.
- Prior to the meeting, the employee will be provided with particulars on the basis of the grounds set out in the preceding paragraph. The employee will be given reasonable opportunity to consider his/her response to the written information and the particulars provided before any meeting takes place. No action will be taken by the employer before the meeting takes place.
- After the meeting, the employee will be informed of the employer's decision and of his/her right of appeal.
- If an employee wishes to appeal he/she must inform the employer within five working days of receipt of the decision. Where an appeal is requested, the employee will be invited to an appeal meeting. Appeal meeting shall be held within five working days of the request for an appeal.
- The employer may implement any decision taken at the first hearing before the appeal meeting is held.
- After the appeal meeting, the employee will be informed of the employer's final decision within five working days.
- The employee must take all reasonable steps to attend the meeting.
- The employee may, were reasonably requested, be accompanied to all meetings by a fellow employee or a (paid/lay) Trade Union representative.
- The employer will endeavour to ensure that:
- each step and action under the procedure is taken without unreasonable delay
- timings and locations of meetings reasonable
- meetings are conducted in a manner that enables an employee to explain his/her case.
Notification of redundancy
- Written notification of redundancy will be made to each person included on the final list.
- The notification will include:
- an employee's date of termination
- details of redundancy pay to be issued in accordance with the Employment Rights (Northern Ireland) Order 1996
- details of other termination payments, if any,
- advice as to whether or not notice is to be worked or a payment in lieu is to be made.
Time off Work and Alternative Employment
- Reasonable time of, as is provided by the Employment Rights (Northern Ireland) Order 1996, to look for alternative employment will be granted to those employees with two years continuous service who are due to be made redundant.
- As part of the measures to avoid or minimise redundancy, the possibility of redeployment will be one of the measures considered (see the section headed "Measures to Avoid or Minimise Redundancy"). An employee who refuses an offer of suitable alternative work may forfeit their entitlement to a redundancy payment.