What’s Next? – Your Redundancy Rights

In Covid-19, Featured

As we move into the next stage of Coronavirus with restrictions beginning to be relaxed we look at some new topics.

When the results of our survey came in last week (a full breakdown can be found here) one of the startling figures was that 38% of hospitality employees are considering a job outside hospitality with another 36% saying they will consider it if things don’t get back to normal by the end of the year.

A week before this we had received a call from Joe Harper of The Savoy. He was worried. Rumours had been flying around of a swathe of redundancies in the hospitality industry, (rumours which have been coming to life since) and he was concerned that many in our industry were unprepared for this outcome. Living in lockdown, with so many on furlough pay, he was concerned that people weren’t preparing for the possibility of losing their jobs in the coming weeks. Quite simply there will not be enough jobs for everyone in hospitality for quite some time and the sooner people start preparing for this the better.

A Zoom call was organised with Joe, BarLifeUK, London Bartender Associations Drew Mallins and Tom Jolly of the Sheraton Grand in Edinburgh. During this call key points were raised, and it became obvious that there needed to be a resource to help people who are inevitably going to have to look outside their comfort zone to earn money in the short, or in some cases long, term.

So here it is, What’s Next?, an area which over the coming weeks will build up an array of help, advice, hints and tips from experts covering everything from your legal rights to transferable skills, from CV writing to Social Media cleansing. Today we start at the beginning with your rights if you are one of the unlucky ones to lose your job thanks to coronavirus.

Redundancy

Redundancy is a word everyone knows, but not everyone knows the definition of. Redundancy is there to protect staff from getting fired for reasons beyond their control with no recourse or financial support. There are many reasons for redundancy (a full list can be found here) however with coronavirus it is only two areas that will really come into play – a business closing down and a business suffering a reduction in sales/revenue.

The advantages of redundancy is that you are entitled to a consultancy and notice period during which you will be paid and if you have been working at a business longer than 2 years you are entitled to statutory redundancy pay. Before you get too excited about this let’s dive into some more details.

Consultancy Period

This is the first step on the ladder of redundancy. The period of time on this one depends on the number of redundancies your company will be making. It is split into 1 – 19, 20 – 99 and 100 plus. You will get paid during this process.

1 – 19 employees being made redundant gives no minimum consultancy period or structure. It is considered to be done within a reasonable time and your employer must arrange a meeting with you (these are mainly being done by phone or video calls during lockdown).

20 – 99 employees being made redundant the consultancy must start 30 days before the first redundancy. This is much more structured and must include a Trade Union or employee representative.

100 plus employees being made redundant and the consultancy period must start 45 days before the first redundancy. This is structured as 20 – 99 employees.

For more information on the consultancy period and your rights you can check out the info here. Something you will hear us saying a lot is, check out your own employment contract, there may be a minimum consultancy period for smaller numbers.

Notice Period

You must be given a notice period from your employer before your employment ends which cannot happen until the consultancy period is over. During this period your employer should pay you as normal. Known as Statutory Redundancy Notice Periods, they are:

  • At least one week’s notice if employed between 1 month and 2 years
  • One week’s notice for each year employed if employed between 2 and 12 years
  • 12 weeks’ notice if employed for 12 years or more

This is the minimum amount and again check your employment contract as you may be due more than the statutory minimum, but you can’t be owed less. Your contract may also allow you to be ‘paid in lieu of notice’ which means they can give you the money instead of the notice period, makes very little difference.

If you are offered payment in lieu ensure you are still getting what is owed, payment in lieu in no way entitles your employer to pay you less than either the statutory minimum or figure on your contract, whichever is higher.

It is worth noting here that during the consultation and notice period you are still employed by your company and they have every right to ask you to work. Whilst that may not seem likely at the moment when we get close to reopening there will be a lot of work needed to get venues back and ready to go.

Redundancy Pay

Statutory Redundancy pay is only available to those that have worked for an employer continuously for 2 years or more (103 weeks actually), however part-time and zero hours workers do still qualify. It is based on your earnings before tax (gross pay – as it is not a taxable amount), your age and how long you have worked for the employer. It looks like this:

  • Half a week’s pay for each year you have worked under the age of 22
  • 1 week’s pay for each full year you have worked between the ages of 22 and 41
  • 1.5 week’s pay for each full year you worked over the age of 41

There is a very hand redundancy calculator on the government website which you can use. The limit for weekly pay is £538.

If you have been employed under 2 years you are not eligible for Statutory Redundancy Pay. However, check your own employment contract, it may be that there is a company plan for those with under 2 years experience and also there may be a higher payment plan than the statutory minimum in place.

Earlier today my wife shouted at the top of her voice ‘You haven’t been listening to a word I’ve been saying have you??’ What a strange way to start a conversation…. Sorry just thought it was all getting a bit heavy. Anyway, back to it.

How are those being made redundant selected?

This is really what the consultation period is for. It is encouraged for employers to consult employees to identify and agree on the criteria based on skills and experience for the future of the business. It is very much up to the individual company however there are many things that can’t be used:

age; disability; gender reassignment; marriage or civil partnership status; pregnancy or maternity leave; race; religion or belief; sex; sexual orientation; family related leave; role as an employee or trade union rep; membership of a trade union; part-time or fixed-term employee status; pay and working hours.

During coronavirus shielding cannot be used as a reason either, as this is disability discrimination.

Your company should put together an appeal process as well for those that feel they have been unfairly chosen to stop the need for lawyers. If they don’t or you get nowhere with this and believe you have been unfairly chosen to be made redundant then the best place to start is this Citizens Advice Bureau page which has plenty of info and details on what to do next.

Being Offered Another Job

For those working in larger companies this will be a lot more prevalent that small single operators but it is worth looking at for everyone. A lot of employers will try to offer staff another job in the company before making them redundant for obvious reasons, this is called ‘suitable alternative employment’.

The chances are it will be a job in a different part of the company and/or on lower pay, if they were to offer you the job you were doing then they’d be no need to make to redundant after all. From here you have three options.

Take the job – Excellent, you still have a job you are happy with. Also keeps you within the company so when things start to improve perhaps you will be more likely to be promoted up the chart. Don’t forget to ask for a new contract, job description and any changes to your terms & conditions.

Turn down the job – Not want you wanted, want to take your chances elsewhere, totally within your rights….. probably. You need a good reason to turn down the job, such reasons include:

  • lower pay
  • longer journey to work or lack of public transport
  • extra costs of getting to work
  • disruption to your family life e.g. problems getting childcare
  • health issues
  • total change in working structure or role

To turn down the job you must write to your employer informing them of this decision, why you have made it and ask for confirmation of redundancy pay. If your employer doesn’t accept your turning down of the new job there are series of actions you can take.

Give it a trial run – If you are unsure about the new job being offered then you are allowed a 4 week trial period. If you have been offered multiple alternative jobs then you can try them all during this 4 weeks. The trial period can start up to 4 weeks after your current job ends.

This period can be extended by agreement between employer and employee if extra training etc is needed, if this happens get the agreement in writing. If your employer doesn’t let you have a trial period you may be able to claim your redundancy is unfair.

If you decide to either take or not take the job during or after the trial period follow the advice for each option above.

Tronc

Ahhhh here it is again. The google hole which has engulfed me so often. Once again, I am afraid to say there is no simple answer to this one and probably not much good news. Some employment lawyers say it should be included when working out redundancy payments as bonuses and commissions are, others say not. Legally there is no precedent that exists that anyone can find.

It appears that it is going to come down to the individual employers (oh go on check your contract) and we are hearing rumours of some of the big groups not including it, which doesn’t bode well.

It is also worth noting that the way bonuses and commissions are worked out for redundancy pay is based on the last 12 weeks of pay so that isn’t going to help anyone.

The main things to take away from this are CHECK YOUR CONTRACT and make sure no-one is pulling a fast one on you. Check out your rights, use the calculator and never accept the first offer on the table before checking it out.

FAQ’s

When will I get paid? This should be no later than your final pay date, unless you both agree another date in writing.

What if my company can’t afford the Statutory Redundancy payments? They will be paid out of the National Insurance Fund through the Redundancy Payment Service.

When does the notice period start? If you are told in person the period should start the next day. If by email or post it should start when you’ve had time to read it, probably the next day also. Guess what, check your contract.

Can I leave during my notice period? Yes, however it is best to speak to your employer to arrange, they are legally not entitled to pay you your notice pay after you leave but you are entitled to your redundancy pay no matter what.

I am part-time/zero hours not full-time what does that mean? Your rights are exactly the same and you cannot be singled out for redundancy due to being part-time/zero hours.

 

 

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