Redundancy - Negotiations

Can I get more redundancy pay?

If you have received a settlement agreement on the back of a redundancy situation you may be asking yourself if you are stuck with the payments offered by your employer and if you can try to negotiate a higher pay out.

Your chances of negotiating a higher settlement package in a redundancy situation will often depends on whether or not your redundancy was fair. If it was not fair this will bode well in negotiations and you can use the employer’s failure to carry out a fair redundancy to your advantage.

Is my redundancy fair?

The law allows employers to lawfully terminate an employee’s contract for a number of ‘fair’ reasons. Redundancy is one of them. If the employer can show they carried out the termination for one of these ‘fair’ reasons like redundancy then the employee is unlikely to succeed with a claim in the employment tribunal unless it can be proven the termination was ‘unfair’.

In a redundancy situation the employer must be able to show the following to prove that proposed redundancy is fair

1. The role is genuinely redundant
2. You have been invited to at least 1 individual consultation to discuss the proposed redundancy
3. The employer has considered alternative to redundancy
4. If your employer is making over 20 employees redundant in a 90 day period they must consult with all affected employees collectively;
5. The employer follows any redundancy process set out in your employment contract or their employee handbook
6. If the employer places you in a redundancy pool they must correctly identify all employees to go into the pool
7. They then must score employees against a redundancy selection criteria to choose the redundancy candidates
8. If you have been chosen for redundancy, you must be informed in writing with a breakdown of your redundancy payment
9. Your employer cannot discriminate against you during the redundancy process

How much should I get if my redundancy is fair?

Ultimately if your employer has carried out a fair redundancy then there is no obligation on the employer to pay you more than your statutory entitled to redundancy pay subject of course to any further obligations under the terms of your contract or a redundancy policy. If you have been offered a settlement agreement on the back of your redundancy It is important to take on board attempting to negotiate for a better redundancy payment may well be counter productive and risk losing the beneficial terms offered. You may still be able to negotiate an increase, particularly if your settlement agreement has been offered before your employer has carried out any formal redundancy process.

Is my redundancy a sham?

If your employer is proposing to terminate by way of redundancy but your role is in fact not ‘redundant’ then your redundancy may well be a sham. Often the most common type of sham redundancy is where your employer lets you go but then recruits someone else for your job.

The sham redundancy often follows difficulties you may have had with your employer prior to being selected like difficulties with your line manager or having lodged a grievance.

Signs of an unfair redundancy dismissal

1. You are the only one being made redundant.
2. The company is not citing financial difficulties as reason for the redundancy.
3. ‘Woolly’ or ‘vague’ statements about financial loss that they are unwilling provide data or evidence to back-up.
4. It looks like the new job description for any restructure is just your existing job ‘re-labelled’.
5. Current vacancies haven’t been circulated and there has been no clear encouragement to apply for other jobs in the company.
6. You believe the selection process or criteria disadvantages you on purpose
7. Others have been told ‘confidentially’ that they are safe yet are also supposedly ‘at risk’ of redundancy.
8. The word ‘proposed’ is not widely used, it feels like a ‘fait accompli’- pre-determined decision.
9. You have made reasonable valid alternative suggestions which have not been properly explored by management.
10. There has been a recent change of management or buy-out and new people with your similar skill set have been recruited.
11. Spending in other areas of the organisation has not been cut.
12. Managers don’t engage with you and your questions in consultation meetings have been left unanswered.
13. Job vacancies exist in other areas of the organisation.