Reemployment After Redundancy

26 February 2021

When a company has to resort to making redundancies, they are trying to keep their business running. This often means searching for ways to cut costs, with salaries often costing businesses a lot.

It’s a tough decision for any employer to make, yet it might save a business. If it does, a company can eventually get back to a pre-redundancy state of business.

Companies often need redundancy legal advice throughout the redundancy process. This includes when considering who to make redundant and after the redundancy itself.

Once the business has stabilised, employers may wish to pursue replacing redundant staff. Reemploying staff after redundancy is also a tempting notion.

However, employers should proceed with caution when considering reemployment after redundancy in the UK. There are laws and regulations that merit consideration.

Peninsula explores these below.

Rehiring after redundancy

If someone is made redundant, they can be replaced. However, until the last day before making an employee redundant, you should explore alternatives to redundancy.

Examples of alternatives to redundancy include suitable alternative employment.

You can rehire after redundancy, but you must show that there has been a significant change in the circumstances of your company.

These changes must show that you now need a new employee and that the company genuinely did not require the role during redundancies.

If you do decide to rehire after making redundancies, you must consider when is appropriate to do so.

How long after making someone redundant can you reemploy?

After making an employee redundant, you can rehire them or hire a new employee almost immediately. There is no strict period of time given for how long you need to wait.

However, you may need to allow some time (typically one week) in between the termination of one period of employment and the commitment of the new employment. This period breaks their ‘continuity of employment.’

The same is not true when considering how long after making someone redundant you can replace them. Unless there were exceptional conditions, you cannot make an employee redundant and then replace them.

This is grounds for unfair dismissal. By definition, you can only make an employee redundant if the role is no longer essential. Replacing an employee immediately after making them redundant suggests the role was essential.

Advertising for jobs after a redundancy

A loss of employees can require advertising for new employees. However, you should proceed with caution.

Once you’ve established that it is safe for your company to start hiring, you can advertise for a replacement. However, when advertising for employees, you should consider the period of time between making an employee redundant and advertising.

For those curious about how soon after redundancy you can recruit, the answer is that there is no set time limit. While there is no time limit for advertising for a replacement, it can potentially cause trouble.

For example, the former employees made redundant may see the recruitment advert. They could then challenge whether the redundancy was genuine and take you to an employment tribunal.

You can advertise a job after redundancy at any time. However, employment tribunals account for the time between redundancies and rehiring. Because of this, any employers that are considering advertising a job after redundancy should wait three months.

This is as soon as a job can be advertised after redundancy, as the time limit for employees to make a claim in an employment tribunal is three months.

However, tribunals can extend the limitation periods if they feel it is just and equitable to do so. An employee made redundant seeing their old role be advertised for could fall into this bracket.

Expert support on reemployment after redundancy with Peninsula

Handling redundancies is rarely a simple process. Considering collective redundancies then needing new talent within a short period of time is confusing for any company.

Mishandling the process can lead to employment tribunals, which can cost employers time and money. Cases in favour of the employee can heavily cost an employer. Currently, the cap is either £88,519 or 52-weeks gross salary, depending on which amount is the lower.

The Tribunal can also choose to award an employee an additional pay, up to a maximum of £16,140.

Peninsula offers expert advice and specialised services to help avoid these fines and confusion. If brought to tribunal, we offer tribunal representation. To avoid getting to employment tribunal, you can get 24-hour HR advice.

For all other HR enquiries and specialist help, call us on 0800 028 2420.

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