Redundancy (Premium)

Managing redundancy and reducing risk

Identify the need

The need for making employee(s) redundant must be identified. A board or partnership meeting should be held in which a discussion can take place and the need for redundancies to be made must be documented.

In the meeting you should discuss and document what alternative options there are. You should consider all available options and explain the likely effect/practicability of them and why they are or are not suitable.

If after discussing (and documenting) the various options you decide that the best way forward is redundancy, you should confirm the total number of employees that are expected to be made redundant, in which department/s and why/how you came to that conclusion. DO NOT, at this stage, discuss the strengths and weaknesses of individual employees, or name individual employees, or certainly don’t document it if you can’t avoid it.

A Fair Procedure

A redundancy dismissal will be unfair if a fair procedure is not implemented in carrying out the dismissal. Indeed, procedure (or lack of it) is often the main cause of a finding of unfair dismissal at an employment tribunal.

Employees who are to be included in the selection pool Link to pool should be given as much warning as possible of potential redundancy as should any representatives in collective consultation. Link to collective consultation This will help to ensure that the redundancy procedure is considered fair.

One key requirement for fairness is that each employee is consulted individually about the proposal to dismiss him or her irrespective of whether collective consultation has taken place. Link to individual consultation. Each employee should be told of the precise reasons why he or she has been provisionally selected for redundancy and given an opportunity to make representations. Any comments the employee makes should be taken into account, both on selection issues and on any suggested alternatives to redundancy, before any final decision is taken. An employee may, for example, have skills of which the employer is unaware that could be deployed elsewhere in the organisation. Alternatively, he or she may be able to identify another employee within the organisation who — due to experience or length of service — could or should be made redundant in his or her place.

If a scoring system is used to grade employees against set criteria, each employee should be informed how his or her score was arrived at, and allowed to challenge the score. All this should take place before any final decisions are reached as to who is to be selected for redundancy.

Mobility clauses

The closure of a single site can sometimes lead to difficulties if the employees have mobility clauses in their contracts of employment. If an employer wishes to enforce such mobility clauses to avoid making the employees redundant, they must establish where an employee is employed to work. If the employee has not in practice been required to work at other locations, the safest approach is to treat the situation as a redundancy and offer work at the other location as suitable alternative employment.

Bumping

This is when management prefer to move a potentially redundant employee into another job and displace the present holder of that post, who will then be dismissed. Provided that the dismissal is attributable to the diminishing requirements of the employer for employees to carry out work of a particular kind, the employee “bumped” out in favour of the employee whose job is disappearing will nevertheless be dismissed for redundancy. This can also be known as a “transferred redundancy”.

An employer should considering these factors in bumping:

  • whether or not there is an actual vacancy
  • how different the two jobs are
  • the difference in remuneration between them
  • the relative length of service of the two employees
  • the qualifications of the employee in danger of redundancy
  • other factors that may apply in a particular case.

Employers are not required to bump employees and there are also age discrimination aspects if the person bumped has less service and is younger. However, some tribunals have said that an employer should consider it, even if they then dismiss it.

Consultation

Collective Consultation

Collective consultation is triggered when an employer is proposing to dismiss as redundant 20 or more employees within a period of 90 days or less. The minimum consultation period is 30 days before the first dismissal notice takes effect, but rises to 45 days if 100 or more employees are to be made redundant at one establishment. Employers cannot lawfully issue notices of dismissal until the minimum consultation period has elapsed.

These are minimum periods and consultation may take longer.

Calculating the Number of Employees to be Dismissed

Since collective consultations are intended to consider an employer’s proposed redundancies, consultations must still take place even if the proposed number of redundancies is over 20 but the actual number of redundancies turns out to be less than 20. Therefore, if the employer is also considering redeployment of some of the employees, but such redeployed employees will be required to agree substantially or to wholly varied contractual terms, these employees are to be counted as “proposed redundancies”.

Similarly, if an employer is proposing to vary substantially, or wholly, employees’ terms of employment, the employees are deemed to be dismissed for these purposes.

Volunteers should be included in the total when calculating the number of redundancies.

When calculating the number of redundancies for collective consultation purposes, only those employees on fixed-term contracts who have not reached the expiry date of their contracts will be covered by the collective consultation rules.

Notification to Business, Innovation and Skills BIS

An employer proposing to dismiss as redundant 20 or more employees within a period of 90 days or less must notify the Secretary of State for Business, Innovation and Skills of its proposal at least 30 days before giving notice to terminate any of the relevant employees’ contracts of employment.

Where an employer proposes to dismiss as redundant 100 or more employees within a period of 90 days or less, it must give the Secretary of State for Business, Innovation and Skills at least 45 days’ notice of the proposals.

This notice should be given on Form HR1.

Failure to comply with the notification requirements is a criminal offence, which can render the employer liable on summary conviction to a fine not exceeding £5000.

One Establishment

Historically the duty to consult arose if the figures applied at one establishment. A ruling has been sought from the European Courts as to whether the UK definition is correct. For the time being the way in which the provision “at one establishment” has been interpreted to date are as follows. “Establishment” does not necessarily just mean an employee’s normal place of work. Employees can be defined as engaged at “one establishment” even when they do not work at the same premises, eg a nationwide sales team.

Factors to consider when establishing whether a number of employees work at “one establishment” include the following.

  • Does the establishment have a degree of permanence?
  • Is there an organisation of people working at the establishment or from the establishment?
  • Even if normally working from different locations, are employees managed from and reporting to the establishment?

Who to Consult?

If the employer has a recognised Trade Union for the jobs to be made redundant then they should consult with them. If there is no recognised Trade Union then consultation must take place with employee representatives and if the employer has none, then they must be appointed for the purposes of collective consultation. Every category of worker must be represented during the consultation process. Therefore if the recognised trade union does not represent all of the affected employees, additional appropriate representatives should be elected to represent the remaining non-union employees. If no representatives can be elected or chosen, the employer should consult directly with the employees concerned.

Election of Representatives

Employers have a duty to ensure the election is fair and representative of all affected employees. Often the employees informally select a representative amongst themselves and only one candidate is proposed. In this event there is no need for an election. If there is more than one candidate then an election must take place for that group.

The Election Process

  • Candidates for election must themselves be affected employees on the date of election.
  • No affected employee must be unreasonably excluded from standing for election.
  • All affected employees on the date of election must be entitled to vote.
  • There must be a candidate for each representative position. Sometimes a group of workers has no-one wiling to stand as a representative. It is sometimes possible for another representative to act for this group if they agree to it. This avoids the need for individual consultation.
  • The voting should be secret and the votes accurately counted.
  • Where an elected representative ceases to act, causing any employee no longer to be represented, a new representative must be elected.

When to Consult

Consultation should be in in good time and be meaningful, that is when the employer is contemplating redundancies and certainly before any final decision is made. The employer should be open-minded and consider the views of the appropriate representatives. The aim should be with a view to reaching an agreement with the representatives. The employer is not required in fact to reach an agreement with the appropriate representatives. Therefore, if the employer has considered and responded to all of the issues raised by the appropriate representatives, the employer can end the consultation process notwithstanding that it has not reached an agreement with the appropriate representatives.

 Collective Consultation Meetings

The purpose of consultation is to discuss ways of avoiding redundancies or reducing the numbers to be made redundant and mitigating the effects of dismissals. The requirement to consult about all three subjects is mandatory and employers cannot escape this obligation on the grounds that consultation about any one of these subjects would be futile.

In order to avoid or reduce redundancies employers should consider:

  • reducing overtime
  • terminating temporary agency staff contracts
  • ceasing sub-contract work
  • freezing recruitment or secondments
  • retraining and redeploying staff
  • reducing hours of work (but only with employees’ agreement)
  • offering sabbaticals

Collective consultation is more concerned with the process and includes:

  • The reasons for the proposed redundancies
  • numbers and descriptions of those employees it is proposed to dismiss as redundant
  • total number of employees employed at each establishment from which redundancies will be declared
  • proposed method of selection for redundancy including the pool(s) and selection criteria
  • proposed method of dismissal, including procedure and timing, having regard to any agreed procedures

All this information must be given in writing.

Volunteers for Redundancy

One way to reduce the number of compulsory redundancies, employers often ask for volunteers. The logic is that no one should be made compulsorily redundant when someone else is prepared to leave voluntarily.

Asking for volunteers is good practice, but many employers are reluctant to offer it as they do not wish to lose their best staff. However, the employer may legitimately decline to accept a particular volunteer for redundancy if, for example, the volunteer is a vital member of staff, or has special skills that the employer does not wish to lose. It is sensible to make it clear at the outset when calling for volunteers that the request may not be granted to avoid disappointment and resentment later.

Voluntary redundancy is still regarded in law as a dismissal (rather than a resignation) so statutory redundancy pay will be payable in the usual way. The employer is not obliged to pay an enhanced redundancy payment to a volunteer, but may choose to do so if it wishes. 

Failure to Consult: Protective Awards

Where an employer has not complied with its legal duty to consult, an employee may present a complaint to an employment tribunal. If the tribunal finds the complaint well-founded, it will make a declaration to that effect and may also make a protective award. An award can be up to 90 days’ pay per affected employee so they can be expensive.

Individual Consultation

It is necessary to consult individually with employees at risk of redundancy about their own personal circumstances even where collective consultation has taken place. Where there is collective consultation this should be completed before moving to consult with individuals.

The invitation to the consultation meetings should be contained in a letter, setting out the date, time and location which should be reasonable and which allows the employee to consider the subject matter. Link to letters If you have a formal procedure make sure you follow it including timescales. All employees who are on long term absence such as maternity, adoption or sick leave should be involved in the consultation process by being sent relevant information and invited to meetings. Link to Selection and maternity leave

The Individual Consultation Meetings

If there has not been any collective consultation then the first meeting should ask the employee if they have any suggestions for avoiding, reducing or mitigating the redundancies as per collective consultation. The selection process and criteria should be also discussed at the first individual consultation meeting so that the employee can make representations about them. It may be, for example, that a criterion has a particularly harsh and possibly unfair effect on that employee. For example, if the number of days sick absence is used in a short period, say the last year, an employee with a good absence record over many years who has had a large number of days off in the last year for a one off incident such as an accident or waiting for a corrective operation, would be unfairly penalised. Taking a longer period of time, say the last 2-3 years would help, or excluding one off illnesses.

Once the selection criteria are decided then the employees should be scored Link to selection criteria below.

A further meeting should be held with the employee to go through their scores and the employee should be given the opportunity to challenge their scores. Where there are more than 2 employees it is possible to tell the employee the range of scores and where they have come in the pecking order. They should never be told the scores of other employees by name and thus with only two people in the selection pool advising them of the other score would be a breach of confidentiality.

Some employees, particularly where only two are in the pool, will challenge by comparing themselves more favourably to the other employee. It should be explained that the exercise is not a comparative one between employees but objectively with each employee against the selection criteria.

Any views should be considered and the employee should be invited to a third meeting to advise them if they have been selected for redundancy. For those who have been selected for redundancy then the meeting should cover the package they will receive on termination (redundancy pay if due, accrued holiday pay and notice). Link to redundancy pay calculation below They should also be advised as to whether they will be required to work their notice, either in total or part, or be paid in lieu in full or in part. Any other housekeeping issues should be covered such as return of company equipment. 

Right to be accompanied

Although employees do not have the legal right to be accompanied by a work colleague or trade union representative (not necessarily one recognised by the employer) at the consultation meeting it is good practice to offer it as it avoids the risk of denying them their right to be accompanied at the final dismissal meeting.

Definition of the Pool for Selection

If more than one employee but not all employees are being made redundant, the employer will need to identify a “pool for selection”. Factors that should be considered when determining which employees should be within the pool for selection includes the following:

  • the reason for the redundancies
  • the type of work carried out by the employees
  • whether people are interchangeable
  • whether other groups of employees are doing similar work.

It is difficult for an employer’s selection to be challenged by a tribunal so long as the employer acts logically and reasonably in identifying the pool for selection.

Determination of Selection Criteria

If redundancy dismissals are to be fair, the employer will have to act fairly and reasonably when determining and applying criteria for selection to the employees in the selection pool.

There is no prescribed legal list of selection criteria, but common criteria include:

  • skills and knowledge relevant to the job
  • relevant experience
  • relevant qualifications
  • job performance (as measured in a formal appraisal system)
  • disciplinary records
  • attendance records.
  • length of service

Discriminatory Criteria

It is unlawful to select an employee on the basis of their sex, sexual orientation, disability, age, race, religion or belief. In addition to this direct discrimination it is possible to indirectly discriminate in the application of the selection criteria particularly in the application of sick absence and length of service, see below.

The most common approach to selection for redundancy is the “score sheet” or skills matrix method. Link to example matrix

This involves:

  • marking each employee in the selection pool against agreed selection criteria, weighting the criteria if appropriate
  • adding up the resulting scores
  • provisionally selecting for dismissal those whose total score is lowest.

The following factors should be considered when determining selection criteria.

  • The criteria should be discussed and agreed with employee representatives where collective consultation takes place, as well as with the individuals concerned.
  • The criteria should be factors that can be measured objectively and are not solely subjective opinions. Judgments that could potentially be seen as subjective can be given a greater degree of objectivity if two or more people are involved in the application of the criteria. This approach will also reduce the likelihood of an appeal on the grounds of bias.
  • Employers should be wary of taking into account factors that appear to allow excessive scope for an employer’s personal prejudice, eg the “attitude” of a particular employee. Identify what it is about the employee which makes you think they have a poor attitude against more specific criteria such as, poor attendance, poor quality and/or quantity of work output, reluctant to implement or constantly challenges management instructions, resistant to change, does not work as a team player.
  • Last in, First Out (LIFO) as a criterion for selection would, in general, discriminate indirectly against younger staff because they are likely to have shorter service than older employees. It can be used in certain circumstances such as rewarding loyalty but it should only be used with a low weighting or as a tie breaker between two employees with the same score.
  • It is important to vet the selection criteria to ensure that they are not directly or indirectly discriminatory, eg on grounds of sex, race, disability, religion, sexual orientation or age. For example, giving preference to full-time employees could indirectly discriminate against women and would also be unlawful under the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000. Also, care needs to be taken with sick absence; pregnancy related absences should be excluded in order to avoid sex discrimination claims. To avoid claims of disability discrimination disability related absences would be safer if discounted but if there are too many then there should be an adjustment to the number of absences eg count only 50%. If the number of days sick absence does not significantly differentiate between employees, or would not alter the outcome from other criteria, it is safer not to use this criterion.

Selection using the Scoring matrix

The following is an example of a selection matrix showing how the criteria and weighting work. The criteria can be sub divided into specific measures relevant to the job. The multiplier is based on the importance of that factor to the company or the job. This may vary between roles, for example, good time keeping is vital for employees such as shift workers or receptionists but less so for office staff as long as the overall hours are worked and the work is done. The score is the value for that particular employee. See the examples in the guide below. An individual who scores highly on a low rated criterion may get a lower overall score than an employee who scores quite well but on an important highly weighted criterion.

The employees with the lowest overall score (adjusted for potential discrimination) are the ones provisionally selected for redundancy. The final scores may be changed following consultation so a definite decision must not be given until after all employees have had an opportunity to comment on their scores.

Example Redundancy Matrix

Name of employee……………………………..

Criteria Multiplier Score

 

TOTAL

(multiplier x score)

Work Performance
Skills, experience and competences
Disciplinary record
Attendance record

 

Sick record Care- disability & sex discrimination
Length of service

Care -age discrimination

TOTAL

 

Signed……………………….

Print name ………………….

Date…………………………..


Example Redundancy Matrix Guide

 

CRITERIA SCORE
Work Performance
Overall performance is outstanding and consistently exceeds the required standard 5
Overall performance exceeds the objectives of the role 4
Overall performance meets all the objectives of the role 3
Overall performance meets most of the objectives of the role 2
Overall performance fails to meet the objectives of the role 1
Skills and Competencies
Displays full competence in current role, is multi-skilled, regularly providing support to others 5
Displays full competence in current role 4
Displays competence in most aspects of current role but requires some supervision 3
Displays some of the competencies required in the current role, requires regular supervision and support 2
Has sufficient skills in the current role and cannot operate without close supervision 1
Disciplinary Record
No disciplinary record 5
Informal disciplinary discussion 4
Verbal warning 3
First written warning 2
Final written warning 1
Attendance Record
Excellent attendance, no instances of absence 5
Above average attendance, some examples of absence/lateness but less than the selection pool average 4
Attendance/timekeeping equivalent to the selection pool average 3
Below average or poor attendance/timekeeping compared with the pool average 2
Unacceptable levels of attendance/lateness 1
Sick Absence exclude pregnancy related absences and adjust for disability related absences
Excellent attendance, no instances of absence 5
Above average attendance, some examples of absence but less than the selection pool average 4
Attendance equivalent to the selection pool average 3
Below average or poor attendance 2
Unacceptable levels of attendance 1
Length of Service – Care to avoid age discrimination
Four years’ or more continuous service 5
Three years’ or more continuous service 4
Two years’ or more continuous service 3
One to two years’ continuous service 2
Up to one year’s continuous service 1

 

Interviews as a Selection Tool

Interviews are subjective and if used they should be against clear competencies and ideally conducted by more than one manager. Each competency should be weighted and scored. They can be a useful addition to other more objective criteria, particularly where knowledge or new skills are required in the new roles and these cannot be assessed from past performance.

Application of the Selection Criteria

Managers responsible for implementing the selection criteria should be:

  • in a position to objectively assess each individual employee in the pool
  • given training and guidance on how to apply the selection criteria.

The manager(s) should jointly consider and mark each individual against the selection criteria. Marking should be done objectively. Personal likes or dislikes and purely subjective opinions that cannot be backed up by facts must play no part in the selection process.

Each employee should subsequently be informed of his or her score, and allowed to make representations. However, there is no obligation to let employees see the scores of other employees.

Redundancy Selection and Employees on Maternity, Paternity or Adoption Leave

It is a commonly held view that employees on maternity leave, paternity leave or adoption leave may not be considered for redundancy. However, the fact that an employee is on maternity, paternity or adoption leave and may not be able to work for some time should not itself be the reason for selection for redundancy. The difficulty is often in measuring the performance and attendance of these employees, particularly if they have been on maternity leave, paternity leave or adoption leave for some time.

If you are comparing them to an employee currently working you must use comparable time frames so for example, sales for the employee still in employment should be compared to the last period for which the employee on leave had sales data. To give an employee on leave the top score can be discriminatory against the employee still working. The absent employee should not be treated more favourably but only to proportionate action to compensate women for the disadvantages caused by pregnancy or maternity leave.

Any failure to involve an employee on maternity, paternity or adoption leave in the redundancy process (eg not consulting him or her about possible redundancy) can make his or her selection unfair. A failure to consult an employee on maternity leave will also constitute unlawful sex discrimination. They also have additional rights on being offered suitable alternative roles. Link to alternative roles

Giving Notice

Statutory Notice Periods

There are minimum statutory periods of notice that must be given to employees who are being dismissed by reason of redundancy. The main points are as follows.

  • An employee who has been continuously employed for more than one month but less than two years is entitled to receive one week’s notice from his or her employer.
  • After two years continuous service the employer must give one week’s additional notice for every further completed year of employment, up to a maximum of 12 weeks’ notice for 12 years’ service.

Complete years for notice are calculated from the employee’s first day of employment going forward. If an employee is dismissed without notice or with inadequate notice, the minimum statutory notice period due to him or her will be added to his or her period of continuous service for statutory purposes.

Contractual Notice Periods

Most contracts of employment are for an indefinite period and will contain an express term specifying minimum notice periods required by both the employee and employer prior to termination of employment. If no notice is specified in the employee’s contract, the employer must give either the statutory minimum period of notice due to the employee, or else “reasonable notice” (which may be longer than statutory notice, depending on the circumstances of the employee’s employment).

Statutory versus Contractual Notice

If an employee’s contract of employment provides for less notice than the statutory minimum period to which the employee is entitled, they will be entitled to the statutory minimum notice. If the contract provides for longer notice, the contractual notice period will prevail. This means in practice that the employee gets the better of the two. Up to 4 years’ service the contractual notice is often the best as most contracts give at least one month’s notice, but employers need to be aware that once an employee completes 5 years’ service the statutory notice overtakes the contractual one month notice. Longer contractual notice takes longer to switch over and if it is three months they will equate after twelve year’s service.

Application of Notice

An employee who is to be dismissed as redundant may, at the employer’s discretion, be dealt with in a number of ways.

  • The employee may be asked to work the notice period, in which case all normal terms and conditions of the contract will continue until employment ends at the end of the notice period.
  • If there is a relevant contractual provision, the employee may be placed on garden leave. This means that the employee continues to be employed during the notice period and is paid normally, but is required not to attend work.
  • The employee’s contract may be terminated with immediate effect so their last day of employment is the day after notice is given bot the end of what would have been the notice period. In this case the employer must make a payment in lieu of notice (PILON). This payment should compensate for all benefits not just basic pay eg an amount for private health care, mobile phones, cars etc. PILON is a breach of contract unless there is a term entitling the employer to dismiss with pay in lieu of notice in the employee’s contract.
  • The employee may work part of their notice and be paid in lieu for the balance of the notice period.

Suitable Alternative Employment

The employer should always consider whether there are alternative solutions to the termination of employees’ employment and discuss these with the employee during individual consultation. In particular, an employer should review the possibility of alternative employment within:

  • the organisation
  • any associated companies, even if these are outside the UK.

“Suitable” employment in this context is work which the employee could reasonably be expected to do (in light of his or her qualifications, skills and experience) and on terms and conditions not substantially less favourable. The more the work or terms and conditions differ from their existing role the more it is open to interpretation by a tribunal as to whether the role is suitable.

An employer should not discount any possibility on the assumption that an employee will not be interested, eg if the job is of a lower status. If in doubt, the best approach is always to discuss all possibilities with the employee.

If there are a number of alternative positions that could be offered to a redundant employee, he or she should be notified of the financial prospects of each of these positions in order to enable him/her to make an informed decision. There is no need to ring fence an employee’s existing salary or other benefits, the terms applicable to the new role are the ones on offer, unless the employer chooses to offer more.

The suitability of an alternative role can vary depending on the individual employee’s personal circumstances. For example, if it is in a different location distance alone will not be enough; the ease of the journey must be taken into account and factors affecting that employee such as:

  • Do they have their own transport and if so the use of it or does a partner have the family car,
  • is there public transport, how long would the new journey take and the cost compared to the old journey (the salary and seniority of the employee will need to be taken into account)
  • Does the employee have any domestic responsibilities such as the need to collect children from school, or a dependent needing care?

Preferential Offer to those Maternity leave, additional paternity leave or adoption leave

Employees on maternity leave, additional paternity leave or adoption leave have the right – if their jobs become redundant whilst they are on leave – to be offered any suitable alternative vacancy in preference to other employees who are not on maternity/paternity/adoption leave. This is the case irrespective of whether the employee is ready at that point in time to return to work. This means that such an employee in effect has first refusal over all other employees even if he/she is not necessarily the best candidate for the vacant post in question. Failure to offer an employee available alternative employment in these circumstances renders any redundancy dismissal automatically unfair.

Trial Period in the New Job

Where an offer of alternative employment has been made which involves a different type of work or different terms of employment, the employee is entitled to a four week trial period in the new job commencing from the start of the new contract. This trial period cannot be extended whilst retaining the employee’s statutory right to redundancy pay except for training purposes. The employer may extend the right to retain their redundancy payment by mutual written agreement.

Where retraining is necessary, this period can be extended by written agreement between the employer and employee. The agreement must specify the date on which the trial period is to end and the terms and conditions that will apply after the trial is completed.

If during or at the end of the trial period, either the employee or the employer gives decides the job is not suitable they can give notice to terminate the contract. In these circumstances the employee will be treated as having been dismissed by reason of redundancy on the date the original contract came to an end. This means that any redundancy payments and notice is calculated on the original date the employment would have ended, not at the end of the trial period.

If the employee and employer accept the new role then there is no entitlement to a redundancy payment or notice pay.

Continuity of Service

Where an employee accepts an offer of new employment as an alternative to redundancy dismissal, continuity of service will be maintained provided that the:

  • offer of the new job is made before the old job ends, and
  • new job starts immediately after the old job ends, or no later than four weeks afterwards.

Calculating Statutory Redundancy Pay

If no suitable alternative roles are available then employees who have been continuously employed for a minimum of two years at the date of his or her dismissal will be entitled to a redundancy payment.

The payment is calculated as follows.

  • Calculate the number of complete years of continuous employment (up to a maximum of 20). For redundancy payments a complete year is calculated by counting backwards from the last day of employment.
  • Calculate the employee’s gross pay per week. This should be used or the statutory weekly maximum if their actual pay exceeds the statutory maximum. This can be found at https://www.gov.uk/staff-redundant/redundancy-pay
  • Allow one and a half week’s pay for each completed year of service while the employee was aged 41 or above; one week’s pay for each completed year of service while the employee was between the ages of 22 and 40 inclusive; and half a week’s pay for each completed year of service while the employee was under age 21.

Absences on maternity leave, adoption leave, paternity leave and parental leave must be counted towards an employee’s length of service for the purposes of redundancy pay. However, working days lost through industrial disputes will not count towards the employee’s period of continuous service.

Redundancy pay can be calculated using the ready reckoner at https://www.gov.uk/calculate-your-redundancy-pay.