It’s a misconception that once you’ve held a redundancy process meeting, and decided who will be leaving your business, you don’t need to do any further work. The employee gets made redundant there and then, right? Well, no. That’s a breach of redundancy notice period rights. To get a redundancy dismissal right, you have to give the correct redundancy notice period (UK). In this guide, we explain the various processes you need to keep in mind to remain compliant with British law.
What is the statutory notice period for redundancy?
You always have to give at least the statutory redundancy notice period. That’s the minimum amount of notice the law requires you to give. But what are the redundancy pay notice periods?
- At least a week of notice if the staff members has between one month and two years’ experience with you.
- A week of notice for each year, if they have between two and 12 years’ experience with you.
- 12 weeks of notice if their time with you is over 12 years.
So the minimum notice period for redundancy depends on the duration each member of staff has spent with your business. As well as statutory redundancy notice, you’ll also need to check your contracts. Any contractual notice period that’s greater than the notice period will have to be given. Failing to provide the correct contractual notice period could lead to a wrongful dismissal claim. If you don’t have enough work for the employee during their notice period, you could look to use a pay in lieu of notice (PILON) or garden leave if you have these in employment contracts. Make any pay for the redundancy notice period alongside any statutory redundancy pay owed to the employee.
Letting your employee decide
It’s not uncommon for businesses to offer a voluntary redundancy notice period to staff members. You should make sure your staff member has all the relevant information available to them, so that they can make an informed decision. Remember, you can’t force through this decision. You simply ask an employee if they agree to terminate their contract. They’ll receive a financial incentive to do so. This approach is usually handed to long-term and senior employees. It’s important to stress that it isn’t mandatory for the member of staff to agree. They’re under no obligations to accept. Their legal rights remain the same. The primary difference is the offer will, again, offer a more lucrative redundancy package than standard redundancy.
Starting the notice period
With the above in mind, when does redundancy notice period start? Well, it comes into effect from the moment you have told the employee their leaving date. Of course, you should provide this information in writing to them as soon as possible. In the letter, you can include extra details such as their employment rights or the amount of pay they’ll receive.
Taxing the notice period
You may also be wondering how you go about approaching taxes if you need to hand out a notice. So, is notice period taxable in redundancy? Well, it does qualify for special tax treatment. Up to £30,000 is tax free. But other aspects of an employee’s redundancy package are still taxed as normal. This includes the likes of holiday pay and PILON.
Providing redundancy notice
After the consultation process has ended, you may meet with individual employees again to give them their redundancy notice verbally. Even if you give verbal notice, it is always a good idea to confirm the redundancy notice period in writing. This letter can set out when redundancy notice starts, ends and confirms that the normal terms and conditions will apply during this time.
What about the voluntary redundancy notice period?
When someone takes voluntary redundancy, the length of the notice period will depend on the terms they have received. Again, this has to be at least the statutory notice period—not forgetting any additional notice contained in their employment contract.
Taking time off to look for a new job
Employees have a right to consider getting another job during the redundancy notice period. So they can have time off to look for new work—or to take part in training for a future role. There’s no specified amount of time off, but it has to be “reasonable”. You also have to pay the employee for this time off. The pay cap is at two fifths of the employee’s pay for one week. If a staff member makes a request for this time off, you should not unreasonably refuse this—it can lead to an employment tribunal claim.
Looking for more help?
Need more support with employment law and redundancy notice periods? We can help you sort out all of your end of contract issues. Get in touch with us today for immediate assistance: 0800 028 2420.