Redundancy or unfair dismissal?

Redundancy is a fair reason for dismissing an employee if it is done correctly, for example, if the business closes down or needs less people for a particular role.

However, if the business is recruiting other people, or only a few are made redundant, this may constitute an unfair dismissal.

When a number of people in similar roles are affected, the company should:

• Speak to everyone together and then individually
• Apply the same, fair selection criteria to all employees
• Give as much notice as possible of the risk of redundancy
• Consult with you (or the trade union) if more than 20 people are affected
• Consider other jobs within the company
• Not take account of maternity leave or absence through disability
• Make a payment covering the notice period and any outstanding holiday, as well as a redundancy payment, if you have been with the company for more than two years

If you are offered, and reject, another job in the company, you may lose the right to a redundancy payment, although you can try the new position for four weeks without being affected.

If you feel the dismissal is unfair, you should:

• Appeal the decision with your employer, in writing.
• If the appeal is not considered, you can make a claim at an Employment Tribunal if you have worked with the company for over a year. This must be done within three months of dismissal.
• Claims can frequently be settled at an early stage, with an agreed amount of compensation.

You can fund the claim yourself or use the legal expenses cover included with your home contents cover. Alternatively, we may agree to not charge unless you win the case.

For more details on redundancy, please download our Guide to Redundancy or contact us.