Redundancy rights during Covid

Karen Holden from A City Law Firm has some advice on your rights around redundancy at this difficult time.


During the pandemic we have seen a considerable rise in employees being served their notice and/or facing redundancy. Many employers have done everything they can to keep their businesses alive and have taken advantage of government schemes, such as furlough, to retain their staff, but there are some that have been unable or unwilling to do so.

The redundancy process

Under current UK employment rights, an employee needs to have worked for an employer for over two years in order to be able to claim unfair dismissal and the same is also true to qualify for redundancy.

There is no automatic right for an employer to put somebody on the furlough scheme without their consent, but anyone can be furloughed, regardless of their length of service and providing they were employed at the key government staging dates.

An employer needs to make sure when choosing people for redundancy that this is done without any discrimination. Otherwise not only would they be potentially looking at an unfair dismissal claim, but also discrimination. This means they need to show that people have not been chosen for redundancy because of their gender, being pregnant, their race or religion or age.

There needs to be a fair process – written notice , fair selection criteria and an identified pool of candidates, a consultation depending on how many staff are being made redundant and any suitable roles within the company must be given due consideration by those who are facing redundancy. So, for example, if only women are chosen or a woman on maternity leave when others should genuinely have been included within the selection pool a discriminatory action may be more likely to succeed.

If a company can be shown to have manufactured a redundancy scenario or to have chosen a staff member for an unfair reason or failed to follow a fair process, they may face a claim for unfair dismissal. Employees will then have the right to issue a grievance, contact ACAS for a resolution, appeal against any decision and, if that is not acceptable, they can take an employment claim to tribunal.

They would need to establish that they were selected unfairly, such as for a discriminatory reason, there was not a fair process followed or their role genuinely is not redundant. For example, the consultancy process may have been unfair; perhaps they were not offered any suitable alternative positions that were actually available or they may not have been paid in accordance with their contract or statutory rights. If any of these apply a staff member with over two years qualifying service is able to challenge their dismissal as an unfair dismissal.

There is also the possibility of claiming constructive dismissal. This is where an employee feels they can no longer work for the employer and must terminate their position. For example,  perhaps due to their pay being reduced without their consent when a male counterpart’s wasn’t or due to being furloughed part time without their consent because they are a parent or being forced to work in unsafe conditions. Whilst it may appear to be a resignation the fact that they’ve been forced into resigning could also be considered an unfair dismissal leading to an employment tribunal claim. If an employee has been treated less favourably, there has been any form of discrimination, the employer has failed to address any grievances or they have breached the contract of employment then the employee should raise a grievance and if this is not resolved to their satisfaction they can consider themselves unfairly dismissed and again go through the ACAS process or issue a claim.

We understand the issue of raising a claim can be a long and costly process. It is also extremely stressful, especially if you’re trying to find alternative work during a pandemic. As such our advice is to discuss everything with your employer, if you have the opportunity to resolve the matter. If necessary, issue a grievance to see if you can go through the formal process to resolve your issues and return your job; or encourage your employer to put you on the furlough scheme rather than redundancy if this is an option available to them. You can actually work for a third party during this time too, providing your contract permits it.

Alternatively, take advice from ACAS to see if they can help mediate a resolution or if none of this works, you could take legal advice.

Rescinded redundancy

In some cases an employer may have announced a potential redundancy, but decided to re-employ the person and offer furlough. This last-minute change is because the furlough scheme has now been extended until March 2021 so you can continue to receive a salary during this difficult time.

Nevertheless, we have also seen employers using this route to avoid the need for lump sum payments. They have instead offered employees 100% of their salaries, whilst furloughed, to serve their notice periods. Some employees welcome re-employment and a guaranteed income; some want the tax-free redundancy payments immediately and the ability to find a new job; and some wish to retain their roles and hope the re-engagement continues past the furlough period. However, it is important to be aware of the options and not to be pressured into doing something you don’t want to, especially if it’s unfair in the eyes of the law.

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