Employment law – Redundancy
Redundancy – Employee
Potentially fair reason in a UD claim
Provides a stand alone right to a statutory redundancy payment if the employee qualifies
Governed by the Employment Rights Act 1996
Step 1 – is the individual an employee?
Yes = s 135(1) gives employee the right to a statutory redundancy pay if they are dismissed by reason of redundancy
No = individual cannot claim statutory redundancy payment
Step 2 – has the employee been dismissed?
S 136(1)(a-c) – an employee is dismissed by their employer only if:
A) The contract under which they’re employed is terminated by the employer (whether with or without notice). Has
there been express dismissal? Objective test under Futty v. Brekkes (D&D) Ltd
B) A limited term (i.e. a fixed term) contract reaches the end of the term and is not renewed
C) The employee terminates the contract (with or without notice) as a result of a repudiatory breach by the
employer
Step 3 – does the employee qualify for the right?
An employee must have at least 2 years continuous employment ending with the relevant date – s 155 – unless relating
to pregnancy or trade union activity there is no minimum service requirement
Relevant date is defined in s 145(2) as
A) (where employment it terminated by notice) the date on which the notice expires
B) (where employment is terminated without notice) the date on which termination takes effect
C) (where a fixed term contract is not renewed) the date on which termination takes effect
If an employee is summarily dismissed, they are excluded from the right to a statutory redundancy payment – s 140(1)
Employee cannot be part of an excluded class to make a statutory claim
Step 4 – has a redundancy situation occurred?
S 139(1) – an employee will be deemed to have been dismissed by reason of redundancy if the dismissal is wholly or
mainly attributable to:
a) The fact the employer has ceased or intends to cease –
i. To carry on the business for the purposes of which the employee was employed (also known as closure
of business redundancy)
ii. To carry on that business in the place where the employee was employed (place of work redundancy)
b) The fact that the requirements of that business –
i. For employees to carry out work of a particular kind
ii. For employee to carry out work of a particular kind in the place where the employee was employed
by the employer
have ceased or diminished or are expected to cease or diminish (employee redundancy)
Murray & anor v Foyle Meats Ltd – 3 stage test to determine whether a redundancy situation exists under s 139(1)(b)
1. An employee must be dismissed;
Redundancy – Employee
Potentially fair reason in a UD claim
Provides a stand alone right to a statutory redundancy payment if the employee qualifies
Governed by the Employment Rights Act 1996
Step 1 – is the individual an employee?
Yes = s 135(1) gives employee the right to a statutory redundancy pay if they are dismissed by reason of redundancy
No = individual cannot claim statutory redundancy payment
Step 2 – has the employee been dismissed?
S 136(1)(a-c) – an employee is dismissed by their employer only if:
A) The contract under which they’re employed is terminated by the employer (whether with or without notice). Has
there been express dismissal? Objective test under Futty v. Brekkes (D&D) Ltd
B) A limited term (i.e. a fixed term) contract reaches the end of the term and is not renewed
C) The employee terminates the contract (with or without notice) as a result of a repudiatory breach by the
employer
Step 3 – does the employee qualify for the right?
An employee must have at least 2 years continuous employment ending with the relevant date – s 155 – unless relating
to pregnancy or trade union activity there is no minimum service requirement
Relevant date is defined in s 145(2) as
A) (where employment it terminated by notice) the date on which the notice expires
B) (where employment is terminated without notice) the date on which termination takes effect
C) (where a fixed term contract is not renewed) the date on which termination takes effect
If an employee is summarily dismissed, they are excluded from the right to a statutory redundancy payment – s 140(1)
Employee cannot be part of an excluded class to make a statutory claim
Step 4 – has a redundancy situation occurred?
S 139(1) – an employee will be deemed to have been dismissed by reason of redundancy if the dismissal is wholly or
mainly attributable to:
a) The fact the employer has ceased or intends to cease –
i. To carry on the business for the purposes of which the employee was employed (also known as closure
of business redundancy)
ii. To carry on that business in the place where the employee was employed (place of work redundancy)
b) The fact that the requirements of that business –
i. For employees to carry out work of a particular kind
ii. For employee to carry out work of a particular kind in the place where the employee was employed
by the employer
have ceased or diminished or are expected to cease or diminish (employee redundancy)
Murray & anor v Foyle Meats Ltd – 3 stage test to determine whether a redundancy situation exists under s 139(1)(b)
1. An employee must be dismissed;
