The following Employment guidance note provides comprehensive and up to date legal information covering:
An employee is entitled to a redundancy payment if he is dismissed by reason of redundancy. An employee is dismissed by reason of redundancy if (amongst others) the reason for his dismissal is that there is an actual or anticipated cessation or diminution in ‘the requirements of the business for employees to carry out work of a particular kind’.
The redundancy legislation does not require that the employee is dismissed because of a diminution in that employee’s particular kind of work, ie because of a diminution in the particular kind of work that employee was carrying out. On the contrary, an employee may be dismissed as redundant, and so become entitled to a redundancy payment, if that employee is dismissed because of a diminished need for another employee’s work. Such a dismissal is described as ‘bumping’, a ‘bumping redundancy’ or sometimes a ‘transferred redundancy’.
Where a redundancy situation arises because the business no longer needs any employees, or as many employees, to do work of a particular kind (see Practice Note: Definition of redundancy—Work of a particular kind), bumping will typically be relevant in three, often conflicting, scenarios:
the employer may wish to retain an employee (usually a more senior, skilled or long-serving employee) whose work has reduced and who is therefore at risk of
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