• Robert Spicer

More redundancy law and practice

SHORT-TERM WORK & LAY-OFFS

Temporary Lay-Offs

Workers can claim statutory redundancy pay that they are eligible for and have been temporarily laid off, without pay or less than half a week’s pay for either:

· More than 4 weeks in a row

· More than 6 non-consecutive weeks in a 13-week period.

Employers must be informed of the intention to claim statutory redundancy pay within 4 weeks of the last non-working day in the 4 or 6-week period.

The claim could be rejected if normal work is likely to start within 4 weeks and continue for at least 13 weeks.

Reduction of redundancy payments:

· Misconduct

· Employees nearing retiring age.

Where an employer fails to pay, the redundant worker may apply for payment direct from National Insurance Fund.

Disputes are referred to Employment Tribunal: section 170, ERA.

Redundancy payments not subject to recoupment.

Time limit for claims: six months from “relevant date”

Relevant dates:

· Contract terminated by notice: date when notice expires

· Contract terminated without notice: date of termination

· Fixed term contract: date on which fixed term expires

· Employee taken to have been dismissed: date on which notice expires

· Special rules where employee worked for trial period.

Where an employee has a contract which allows them to be temporarily laid off without pay, or put on shorter working hours with a cut in pay, sections 147 to 150 of ERA apply. These rules apply where a worker has been laid off or placed on short-time for at least four consecutive weeks or 6 weeks in a 13-week period. There is a procedure for notices and counter-notices which allows the worker to resign and claim redundancy pay.

Craig v Bob Linfield and Son: C was employed by B for 10 years. His contract included the right for the employer to lay off workers for an indefinite period without pay. C was laid off for four weeks. He complained of unfair constructive dismissal on the basis that the lay-off had been longer than was reasonable and that B was in repudiatory breach of contract. The ET dismissed the complaint. C appealed to the EAT.

The EAT dismissed the appeal. It stated that Parliament had provided a statutory scheme which provided for a four-week period during which there was no entitlement to claim a redundancy payment. Even if there were an implied term that a period of lay off would extend no longer than was reasonable, Parliament had set out a four-week benchmark from which there would have to be cogent and well-evidenced reasons to depart. There were no such reasons in this case.

Reference:

Craig v Bob Linfield & Son Ltd UKEAT/0220/15

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