I have been laid off without pay and I have been told to look for another job by my employer. Can I claim redundancy?


There has been a lot of recent press regarding large employers laying off their staff due to business closures or reduced demand for services due to Corvid-19. Some employers have even gone as far as to tell staff to take other jobs. This is all taking place despite the government guaranteeing an unprecedented financial support package. Many employees will not want to return to work for such companies but will right feel they deserve redundancy pay to reflect their service for that company. There is a scheme in place that provides just that. Mark Pritchard explains it here.
Mark Pritchard


Unfortunately, the scheme is notoriously complex.Lord McDonald in Kenneth MacRae and Co Ltd v Dawson 1984 IRLR 5, EAT stated that, “…the provisions… have been the despair of all who have been concerned with the interpretation of industrial legislation since the scheme of statutory entitlement to a redundancy payment was introduced in 1965”. This article seeks to explain the guide in as accessible a way as possible.

A person who has been laid off or is receiving less than 50% of their weekly pay “short-time” is able to claim a redundancy payment, but they must follow a very strict process laid out in s.148 of the ERA. For those who have irregular working hours weekly pay is determined by an average of the last 12 weeks you were paid.

To qualify for the scheme, you must either;

Have been laid off or kept on less than 50% pay for four consecutive weeks, or;
Have been laid off or kept on less than 50% pay for six weeks out of thirteen without more than three of those weeks being consecutive.

If you qualify for the scheme you must write to your employer telling them you intend to claim for redundancy. This document should be headed “notice of intention to claim redundancy” (NIC). It should contain the period of time you say qualifies you to claim redundancy (start date of lay-off/less than 50% pay to latest date of lay-off or less than 50% pay) This notice must be sent within four weeks of the later date on the letter [s.148].

Once you have sent the letter your employer has the right to contest that they are liable to pay your redundancy pay. If they want to do that they MUST serve a written counter-notice within seven days of service of the employee’s NIC [s.149].

If you have fully complied with the requirements above, an employer can only defeat a claim at this stage if, at the date of service of the NIC, there is a reasonable expectation of a return to normal working within the next four weeks [s.152]

If the employer has served, and not withdrawn, a valid counter-notice, then the employee must apply to a tribunal to decide the matter [s.149].

Finally, if the employer fails to serve (or serves and then withdraws) a counter-notice or a tribunal upholds the employee’s claim, the employee must terminate his or her contract of employment by giving either one week’s notice or contractual notice — whichever is the longer — within three weeks [s.150].

Once that is done your employer will have to pay a redundancy payment. The payment is linked to the length of time you are employed [s.162] and the amount you were paid.

Employment claims can give rise to complex issues in law. It is advisable to seek legal advice as soon as possible.

Mark Pritchard provides advice on employment law issues as Direct Access counsel. He specialises in human rights aspects and LGBTQIA+ issues arising from employment disputes.