If an employer makes an employee who has two or more years service, redundant, then they must make a statutory redundancy payment based on the amount they earn per week, length of service and age.
Weekly pay has now been set at a maximum of £489, which is an increase of £10 per week (previously £479 per week). With this in mind, it now means that the maximum award for statutory redundancy will also increase, under the new legislation, from £14,370 to £14,670.
This may be particularly pertinent for employers who are making large scale redundancies.
Changes to unfair dismissal compensatory awards have also come into effect, increasing from £78,962 to £80,541. This will be effective on any dismissals on or after 6th April 2017.
Employers must follow a fair redundancy process when making employees redundant. There must be a genuine redundancy situation and the employer must ensure that there are no other available options to them, for example trying to redeploy them in another area of the business.
If the redundancy situation is not genuine, then the employee may be able to sue the employer for unfair dismissal.
Tom Street qualified as a solicitor in 2003 and has over 20 years experience in employment and litigation law. He studied law at the University of Manchester before undertaking the legal practice course at the College of Law in Guildford, going on to complete his legal training at a firm in Chancery Lane, London. Once fully qualified, he moved to a niche litigation practice in the City of London.
In 2010, Tom set up his own legal practice, Tom Street & Co Solicitors and as part of this, in accordance with his strongly held objective to provide everyone with an easy pathway to justice he established the online portals Do I Have A Case? and Tribunal Claim. These websites are trading names of Tom Street & Co Solicitors.