1st October 2020
For many employers, the government’s Coronavirus Job Retention Scheme, launched in March 2020 has provided a safety net in the current economic climate by helping them to avoid making mass staff redundancies. Since its launch it has paid the wages of 9.5m workers, paying 80% of wages, capped at £2500 a month, with companies required to cover some of the costs from August 1.
Unfortunately for many businesses the impact of the pandemic has been too great, with redundancies being inevitable. With the furlough scheme due to end on October 31 it is estimated up to 1.2m people could be made redundant before the end of the year, according to the National Institute of Social and Economic Research.
If you have been made redundant whilst on the furlough scheme you may be wondering what legal rights you have and whether you are entitled to make a claim.
Can my employer make me redundant whilst on furlough?
Since there are no laws surrounding the Coronavirus Job Retention Scheme, the guidelines are as set out in the Government’s official guidance for employers and employees, which states that an employer can still make you redundant while on furlough.
Have my redundancy rights changed since the outbreak?
Employees still have the same legal rights if they are made redundant while on furlough as they did prior to the outbreak, which means that employers still need to follow certain procedures when making staff redundant. This includes a period of consultation which gives you a chance to hear the reasons behind your proposed redundancy and discuss possible alternatives. Currently the collective consultation period is a minimum of 30 days for employers looking to make 20 or more employees redundant, or a minimum of 45 days for employers proposing to make 100 or more employees redundant. If fewer than 20 employees are being made redundant then employers will most likely still carry out a consultation but it does not need to be done collectively.
If you have worked for your employer for more than two years then you are entitled to redundancy pay and your employer needs to ensure that a dismissal for redundancy is fair. This means employers will need to provide a warning or consultation, use a fair basis for selecting those staff to be made redundant and consider alternatives to redundancy such as suitable alternative vacancies. Employers need to be careful when deciding on the selection criteria for those staff being made redundant; they can’t make you redundant on discriminatory grounds. Discriminatory grounds include making you redundant because of your age, race, gender, sexual orientation, religious beliefs, pregnancy, maternity/paternity, working patterns, or being a member of a trade union. A redundancy process needs to be fair and reasonable and your dismissal may be unfair if, for example, your employer doesn’t notify you that you are being made redundant or fails to look into alternatives to redundancy.
What payments will I receive if I am made redundant whilst on furlough?
If you are put at risk of redundancy and your employer starts a consultation then it can pay you only the furlough rate during the consultation period. However any statutory notice pay or statutory redundancy pay must be based on your normal wage and not at the furlough rate.
If at the end of the consultation period it is decided you are to be made redundant then you will be given a notice period of at least one week if you have been employed between one month and two years, or one week’s notice for each complete year worked at the company for more than two years, which is capped at twelve weeks’ notice, however your contract may give you more notice.
As of July 31 workers on furlough will receive statutory redundancy pay at the normal rate of pay rather than the furlough rate. The amount of statutory pay you receive depends on your age; if you are 21 or under you get half a week’s pay for each full year you worked; if you’re aged between 22 and 40 you’ll receive one week’s pay for each year worked and if you’re 41 or older you will receive one and a half week’s pay.
Redundancy Solicitors Nottingham – Get in touch
The law surrounding redundancy and employees’ rights can be complex and confusing but our employment law team is on hand to help with any enquiries you may have. If you have been made redundant whilst on furlough and want to know if you can make a claim against your employer contact our employment solicitor Natalie Abbott on email@example.com or 0115 910 6244.