Are you facing redundancy and in need of legal advice?

Are you facing redundancy and in need of legal advice?

Holly Brewster from our employment team looks at some of the key questions if you are facing redundancy and your employer has asked you to sign a settlement agreement.  Please contact Holly on holly@bradleyhayneslaw.co.uk or call 01905 900919 for employment advice.

In these difficult economic times, many people across the country are unfortunately being made redundant. It is important for you to know your rights if your role is at risk of redundancy and your employer has asked you to sign a Settlement Agreement.

Am I being treated fairly?

Due to the Coronavirus, you may be offered furlough leave as an alternative to redundancy but if redundancy becomes inevitable, you may still be made redundant.

In a redundancy situation, your employer is required to follow a consultation procedure prior to making your role redundant, this can be time consuming and costly to the business.  You may be offered a settlement agreement by your employer as an alternative to following a fair redundancy procedure or to act as a ‘clean break’.

What is a settlement agreement?

A settlement agreement is a legally binding document that waives your rights to make a claim, covered by the agreement, to a tribunal.  The agreement may include an additional payment as an incentive to sign the agreement and you may also be offered a reference.  You are required to take advice from a suitably qualified independent legal professional for the agreement to be binding.  Please remember that a settlement agreement is purely voluntary.

What redundancy payment am I entitled to?

If you have two year’s service, the minimum legal entitlement for redundancy is as follows:

• Half a week’s pay for every year of service while you were less than 22 years of age, plus
• One week’s pay for every year of service between the ages of 22 and 40, plus
• One and a half week’s pay for every year of service while you were aged over 41.

For statutory redundancy purposes, the maximum week’s pay is currently set at £538, so if you earn more than that amount per week, the maximum you can use to calculate your entitlement is £538 per week.

The length of service for which you can claim is also capped, at 20 years. If you have worked for the same employer for more than that, you can only claim the maximum of 20 years.

This means that the maximum redundancy payment you can receive under the statutory scheme is currently £16,410 (which is 30 weeks at £538 per week). Please note that redundancy pay under £30,000 is normally non-taxable.

Your employer may offer you an enhanced redundancy payment over and above the minimum.

You are also entitled to pay in lieu of notice if you are not required to work your notice together with any outstanding holiday entitlement due at the date of termination.

How can we help?

We can offer straight forward advice on the settlement agreement to ensure you understand the terms of the agreement, the payments you will receive and the rights that you are signing away.  We have a very experienced employment team who will answer all your questions and can negotiate on your behalf if necessary.

During November, we are offering a “NO GAP” service, which means that we will give you the required legal advice at no extra cost to yourself, in straight forward cases. We will not charge any more than your employer’s contribution to the agreement.*

Contact our employment team on 01905 900919 or email holly@bradleyhayneslaw.co.uk for more information on how we may be able to assist you.

• Subject to our terms and conditions.