Redundancy is a form of dismissal from your job, this happens when the employers need to reduce their workforce.
Compared to the number of layoffs in the pharmaceutical companies from last year they have decreased. The reason for the slow layoffs is down to the efforts by the pharmaceutical industry due to companies responding to COVID-19 and drug companies launching new trials and treatments.
Some pharmaceutical companies like Lloyds Pharmacy have had a ‘redesign’ therefore a number of job roles are at risk of redundancy due to the impact losses of COVID-19. Even though there was an increase in February 2020 however COVID-19 has made the marketplace operate in a “volatile market place, made even more challenging by the impacts of COVID”.
An employer should follow a fair and reasonable process when employees are being made redundant. Firstly, the employee must be employed for a continuous of two or more if you feel as if a fair redundancy process has not been followed.
The stages of redundancy
While there is not a set process that needs to be followed for the redundancy process, every workplace should have a redundancy policy which should be found in the company handbook. If there is no redundancy policy, they would need to follow a fair redundancy process.
When an organisation is going through the redundancy process they must clearly explain:
How they will choose people to be made redundant
How long will the decision take?
When the meetings will be and the meetings you can go to
The appeal process procedure if you have been chosen to be made redundant
Under these rules you would also have a chance to meet with the employer by yourself and discuss the redundancy process. You can bring a union representative or colleague.
At the meeting, the employer should discuss the reasons why they need to make these redundancies and if it applies, why you are in a redundancy pool, if there are any other opportunities if there are any and lastly, what happens next. You can also discuss with the employer why you think you should not be chosen for the redundancy. If you believe that the process was unfair then this would be the best opportunity to bring it up.
If you are on holiday, sick or maternity leave, your employer must discuss with you the decision to make you redundant before the process starts.
Even if you have been offered voluntary redundancy by your employer, you still have the same rights as someone taking compulsory redundancy. The Employment Rights Act 1996 still classes this as a dismissal. Employers must follow the same process for redundancy.
What are you entitled to when being made redundant?
The employee is entitled to redundancy payment provided they have been in continuous employment for two years. The employee should check their contract of employment first to see if there is an agreed method of calculating their redundancy payment. This is called the ‘contractual redundancy payment’, if nothing is stated in the contract, the employee would be entitled to the ‘statutory redundancy payment’ which is set by the government.
How redundancy pay is calculated?
Redundancy is based on how much you earn before tax which is called gross pay. During COVID-19, you have the same redundancy rights.
To calculated how much redundancy, pay you are eligible for depends on:
● Your age
● How long you have worked for your employer
Your weekly pay should also include any regular overtime. Your contract may state that you must get paid for and any bonuses and commission which you have incurred. You may get more than the statutory payment if this is stated in your contract.
For each full year you have worked for your employer, you will be entitled to the following:
● Age 18 to 22 – half a week’s pay
● Age 22 to 40 – 1 week’s pay
● Age 41 and older – 1.5 weeks’ pay
You will not have to pay any tax on your statutory redundancy pay.
There are limits to the amount of money you get from your redundancy. The weekly amount is £538, and you can only get redundancy for a maximum of 20 years’ work.
If you have been on furlough during COVID19, you must use your normal full pay when working your redundancy pay out.
How much notice does my company need to give me?
You must be given some notice before your employment ends.
Statutory Redundancy Notice Periods
● At least one week’s notice if employed between one month and 2 years
● One week’s notice for each year if employed between 2 and 12 years
● 12 weeks’ notice if employed for 12 years or more
Your employer should pay the notice period or pay you In lieu of notice, this would depend on the circumstances. Notice pay is calculated based on your earning average per week over 12 weeks before your notice period starts.
If you were on furlough, your notice pay would be based on what you would have earned normally.
Your employment can be ended without notice and this is called ‘payment in lieu’ therefore the employer would pay you instead of giving you notice. You would be able to receive any basic pay you would have received during the notice period. You may be eligible for extras such as pension contribution or health care insurance.
For redundancy advice from specialist employment lawyers, and more information on the redundancy process in the UK, get in touch. You can contact our team on 0330 221 0684 or contact our employment law firm online.
Navigating Workplace Harmony: A Guide to the ACAS Code of Practice
January 2024 Newsletter
GET IN TOUCH
Do you need help? Request a consultation now.
KLG are always here to help. To arrange a free 15 minute introductory consultation call, where we can identify your needs and show you how we can support your business or you as an individual. Please complete our form.