redundancy payment
📖 O que é redundancy payment? Significado e conceito
A redundancy payment is a financial entitlement for employees who have been dismissed because their role is no longer needed by the employer. This can happen, for example, due to a downturn in work or the loss of a client, leading to a reduction in the need for staff. Employment Tribunals have the jurisdiction to award these payments, ensuring that employees receive the sums they are due.
The payment is typically calculated in accordance with specific legal provisions, such as those found in the Employment Rights Act 1996. It forms part of the overall financial settlement an employee might receive upon termination, which can also include arrears of pay, notice pay, and compensation for untaken holidays. In some cases, a redundancy payment might be considered to cover the basic award in an unfair dismissal claim.
Employers are legally obliged to make these payments when redundancy is established. If an employer fails to do so, an employee can bring a claim to an Employment Tribunal, which can then order the employer to pay the specified redundancy sum. The Tribunal will determine the correct amount based on the relevant legal framework and the specifics of the employment.
📋 Requisitos
- The employee's job must have ceased to exist or the need for the employee's services must have diminished.
- The employee must have been dismissed due to redundancy.
- The claim for a redundancy payment must be found to be 'well founded' by an Employment Tribunal.
📝 Procedimento
- An employee brings a claim to an Employment Tribunal.
- The Employment Tribunal assesses the claim, even if the employer does not participate.
- The Tribunal determines if the employee is entitled to a redundancy payment.
- The Tribunal calculates the specific sum of the redundancy payment.
- The Tribunal orders the employer to pay the redundancy payment to the claimant.
💡 Exemplos
- Cleaners were made redundant by their employer after the client business they worked for lost a major client, leading to a downturn in work.
- An employee was unfairly dismissed, and the basic award for that dismissal was met by the redundancy payment they were entitled to.
- An Employment Tribunal ordered an employer to pay a redundancy payment of £1400 to a claimant, calculated under the Employment Rights Act 1996.
- Two employees, a Mr. and Mrs., were each awarded a redundancy payment of £2340 and £3120 respectively, alongside other sums like arrears of pay and notice pay.
📚 Base legal
- Employment Rights Act 1996 section 135
- Employment Rights Act 1996 section 162
❓ Perguntas frequentes
What is a redundancy payment?
A redundancy payment is a sum of money an employer must pay to an employee whose job has been terminated because the employer no longer needs that role, for example, due to a downturn in business.
When am I entitled to a redundancy payment?
You are generally entitled to a redundancy payment if your employment is terminated due to redundancy and an Employment Tribunal finds your claim for such a payment to be well founded.
How is a redundancy payment calculated?
The calculation of a redundancy payment is typically done in accordance with specific legal provisions, such as those outlined in the Employment Rights Act 1996, taking into account factors like your length of service and age.
Can I claim other money if I am made redundant?
Yes, in addition to a redundancy payment, you might also be entitled to other sums like arrears of pay, notice pay, and payment for any holidays you have accrued but not taken, as seen in some Tribunal awards.
What if my employer doesn't pay my redundancy payment?
If your employer fails to pay a redundancy payment you believe you are entitled to, you can bring a claim to an Employment Tribunal, which has the power to order the employer to make the payment.
Is a redundancy payment the same as compensation for unfair dismissal?
While distinct, a redundancy payment can sometimes satisfy the basic award component of compensation for unfair dismissal, as noted in some Tribunal decisions.