Entitlement to statutory redundancy payment
Entitlement to statutory redundancy payment

The following Employment guidance note provides comprehensive and up to date legal information covering:

  • Entitlement to statutory redundancy payment
  • Statutory entitlement
  • Is the worker an employee
  • The 'relevant date'
  • Period of continuous employment
  • Dismissal
  • By reason of redundancy
  • Employee’s counter notice to shorten the notice period
  • Nature of a redundancy payment
  • How the payment is calculated
  • more

An employee is entitled to a redundancy payment when they are dismissed by reason of redundancy.

Statutory entitlement

A worker is entitled to a redundancy payment when:

  1. they are an employee (see: Is the worker an employee below)

  2. they have been continuously employed for not less than two years at the ‘relevant date’ (see: The 'relevant date' and Period of continuous employment below)

  3. they have been dismissed (see: Dismissal below), and

  4. the dismissal was by reason of redundancy (see: By reason of redundancy below)

Entitlement to a statutory redundancy payment for lay-off or short-time working

An employee may also claim a statutory redundancy payment if they are laid off (as defined), or are put on short-time working (as defined) for a specified number of weeks. For further guidance, see Practice Note: Redundancy payments for lay-offs and short time.

Is the worker an employee

A worker must be an employee before they can claim a redundancy payment. Some types of worker who would normally be excluded are brought within the redundancy payments provisions by special legislation, and other classes of worker are excluded.

Eligibility

The definition of 'employee' for these purposes is 'an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment'. Contract of employment means either a contract of service