Throughout the Covid-19 pandemic, redundancy has remained the major concern for UK workers with hundreds of thousands being impacted by the cost-cutting measures workplaces have had to face.
What is voluntary redundancy?
Voluntary redundancy is where staff select themselves for redundancy as an alternative to the employer making the decision themselves. Although this seems unlikely to occur, it is not uncommon for some to put themselves forward without being prompted to. Although, employers can ask staff if any wish to be made voluntarily redundant.
In such situations, there are a few things that employers ought to bear in mind:
- Employers do not have to accept voluntary redundancies – this is the company’s decision for who should be made redundant.
- Voluntary redundancies can help make carefully managing the procedure slightly easier for employers.
- If employers accept voluntary redundancy, it needs to be processed in the usual way.
To ensure this type of redundancy is handled equally, employers should provide written notification that their employment is coming to an end because of redundancy. The employee must also provide their last date of work and any redundancy pay entitlements or outstanding holiday pay.
An employee that has worked for the business for at least two years will be entitled to receive statutory redundancy pay. This is the amount they should receive, provided that their contract states an enhanced redundancy payment.
What about notice periods?
An employer needs to provide notice as specified in their contract. If they do not, they should at least provide the statutory minimum notice in place when dismissing an employee, as follows:
- One week if the period of continuous employment is less than two years but is one month or more.
- One week for each year of the employment, up to a maximum of 12 weeks – this applies to continuous employments of two years or more.
Do employers need a voluntary redundancy policy?
Employers should consider implementing such a policy to make it clear to employees that whether there are volunteers or not, it does not necessarily mean that those volunteering for redundancy will be made redundant. The employee is ultimately opting themselves for consideration and the final decision lies with the employer entirely.
This is important to implement as it allows businesses to reject applications from employees working in critical or important roles that they cannot afford to dismiss. This will also allow employers to organise a skilled workforce of their choice.
Major restructuring or company re-organisations can pose lots of HR challenges, HR Caddy can provide the knowledge, experience, and support to ensure that any major changes are managed as smoothly and efficiently as possible. For more help or advice on redundancy schemes, please contact us today.