Redundancy and continuous employment rules

[Fez909]

A friend works for a local authority and is being made redundant in April. She's found a job that starts in April but she thinks that this will mean she would have to pay back the redundancy money because she wouldn't have a break in employment. I think she's mistaken here. Am I right?

As I understand it, 'continuous employment' is used to ensure that people employed on successive short term contracts are paid redundancy payments to avoid employers sacking you after 18 months and then re-employing you immediately after. She'll be moving from one local authority to another, which is a special case in continuous employment, and is why she thinks it applies here.

I can see one way it might be true, in that because she won't have a significant break between being employed by the two LAs, if the second one was to make her redundant also, then she'd be able to claim the full term of continuous employment and get a payout for her period at LA #1 twice - once now, once again when the second one lays her off.

Shit, typing this out has almost made me change my mind, but that can't be right, surely?

 

[Miss-Shelf]

What your second to last paragraph says. I. Am Pretty sure is the case

I have just come out if a redundancy situation and got a new job. I would have liked to have got both the payout and the new job but opted for the new job elsewhere

When I rang acas they were saying
what you said in that later paragraph
I that there must be a short break in continuous service to avoid this

But more knowledgeable people like Guineveretoo will be along shortly

 

[Manter]

So she is being made redundant from one job, but has found a new job somewhere else?

 

[Fez909]

So she is being made redundant from one job, but has found a new job somewhere else?

Yes.

LA1 making her redundant. She's applied for a job at LA2 and been offered a position.

 

[Fez909]

What your second to last paragraph says. I. Am Pretty sure is the case

I have just come out if a redundancy situation and got a new job. I would have liked to have got both the payout and the new job but opted for the new job elsewhere

When I rang acas they were saying
what you said in that later paragraph
I that there must be a short break in continuous service to avoid this

But more knowledgeable people like Guineveretoo will be along shortly

Thanks. Rubbish if true

 

[Puddy_Tat]

is new job also local authority?

same authority or different one?

is it redundancy or early retirement with pension?

there is (or used to be when i worked in local authority which was some time ago) the concept of 'continuous local government service' which meant your service for things like holiday entitlement started from day one of the first job.

i'm not quite sure how it stands for redundancy - there have been rumblings from the tories about people getting big pay-offs from one local authority then going straight to another - although think any restrictions may only apply at the higher end of the pay scales.

i am fairly sure that 'continuous service' would not apply if there was a redundancy payout - i don't think you would be allowed a redundancy payment from job 1, then use the service in that job to count towards redundancy in job 2.

 

[Manter]

If you resign under U.K. Law you are not entitled to a redundancy payout. If your employer makes you redundant, they pay you redundancy pay. It doesn't matter when you find a new job- if you start the next day or the next year- it's about how the employment ends. They are two separate employments.

If you find a new job with the same employer you are not entitled to redundancy, and if you are rehired by the same employer you may have to pay tax on the redundancy payment (as at that point it becomes an incentive payment not a redundancy payment).

I don't know if there is some all local government is the same employer thing- but if it's a different employer and they terminated her employment, she gets the redundancy pay

 

[Miss-Shelf]

If you resign under U.K. Law you are not entitled to a redundancy payout. If your employer makes you redundant, they pay you redundancy pay. It doesn't matter when you find a new job- if you start the next day or the next year- it's about how the employment ends. They are two separate employments.

If you find a new job with the same employer you are not entitled to redundancy, and if you are rehired by the same employer you may have to pay tax on the redundancy payment (as at that point it becomes an incentive payment not a redundancy payment).

I don't know if there is some all local government is the same employer thing- but if it's a different employer and they terminated her employment, she gets the redundancy pay

With continuous service in the public sector ( parts if it) I have think it is slightly different eg if you get teachers pension or local govt pension, it's likely to add up to continuous service

 

[Manter]

With continuous service in the public sector ( parts if it) I have think it is slightly different eg if you get teachers pension or local govt pension, it's likely to add up to continuous service

Redundancy payments are non pensionable though.... so it would depend on whether they are classified as the same employer

 

[Puddy_Tat]

I've found this (which i must admit is from a union i've not heard of - they seem to be fairly small in the education sector) which, if correct and still current - see the bit towards the bottom of the page, suggests that if you go straight from one local authority (or comparable organisation) without a break of more than 4 weeks between the two jobs, it counts as continuous service (presumably in terms of future redundancy payment as well as entitlement to sick pay / holiday entitlement appropriate to your combined service) but you're not entitled to a redundancy payment in respect of the first job.

 

[Manter]

I've found this (which i must admit is from a union i've not heard of - they seem to be fairly small in the education sector) which, if correct and still current - see the bit towards the bottom of the page, suggests that if you go straight from one local authority (or comparable organisation) without a break of more than 4 weeks between the two jobs, it counts as continuous service (presumably in terms of future redundancy payment as well as entitlement to sick pay / holiday entitlement appropriate to your combined service) but you're not entitled to a redundancy payment in respect of the first job.

Yup, does read like that. I'd suggest check with her own union/a lawyer given that Fez909

At least it means sick pay, legal protections, holiday all follow her too, I guess

 

[Miss-Shelf]

I've found this (which i must admit is from a union i've not heard of - they seem to be fairly small in the education sector) which, if correct and still current - see the bit towards the bottom of the page, suggests that if you go straight from one local authority (or comparable organisation) without a break of more than 4 weeks between the two jobs, it counts as continuous service (presumably in terms of future redundancy payment as well as entitlement to sick pay / holiday entitlement appropriate to your combined service) but you're not entitled to a redundancy payment in respect of the first job.

It was a union set up by e early years professional s

 

[Puddy_Tat]

another angle to this is when is she going to leave current job?

i'm not quite sure what the legal position is if you are under notice of redundancy but resign before your redundancy takes effect - leaving before the redundancy date might mean you don't qualify for redundancy pay.

i did have a temp job in a civil service office a few years back - the office was being closed down (but i and a few others got taken on temp because too many people had already left) so i wasn't eligible for redundancy, but there was a deal for the permanent staff that the office closed on X date, but they could leave something like a month before that date and keep their redundancy pay. I don't know if this is a legal entitlement, or a concession that had been negotiated.

i think to maintain 'continuous local government service' you need to make sure both old and new employers know what's happening so that (for example) you're technically employed by old employer up to the day before you start with the new one (even if that's a sunday) rather than tell them after the event.

ultimately, i'd be inclined to suggest talking to union and HR (both at current and new employer)

will need careful handling to get the best outcome.

local government t & c have moved on since i was directly employed (oh shit - nearly 15 years ago) - 'single status' was at a fairly early stage, and more authorities have opted out of the national agreement since then.

the more i think about it, the more i think that you can't get redundancy now based on (say) 5 years service then get another redundancy in 5 years' time based on 10 years service.

 

[Fez909]

She's checked with her union and they said she will get the payout, but she's researched it independently and thinks she's been misinformed.

Two LAs (different ones) are classed as the same employer for continuous employment purposes. I can see how it'd be tricky to pay someone out on the first one, but still have them maintain continuous employment status.

LA #1 - let's say she works there 2 years and get £100 a week and is then made redundant. She gets £200 payout.

LA #2 immediately offer her a job. She takes the job and works there for two years. Under continuous employment, she'd get 4 years payout, as well as the benefits she'd enjoy that go with being somewhere 4 years over 2 (extra holidays or whatever).

So, I think I now agree with her that she'll lose her redundancy money. Or have to opt-out of continuous employment, if such a thing is possible.

 

[Fez909]

another angle to this is when is she going to leave current job?

i'm not quite sure what the legal position is if you are under notice of redundancy but resign before your redundancy takes effect - leaving before the redundancy date might mean you don't qualify for redundancy pay.

i did have a temp job in a civil service office a few years back - the office was being closed down (but i and a few others got taken on temp because too many people had already left) so i wasn't eligible for redundancy, but there was a deal for the permanent staff that the office closed on X date, but they could leave something like a month before that date and keep their redundancy pay. I don't know if this is a legal entitlement, or a concession that had been negotiated.

i think to maintain 'continuous local government service' you need to make sure both old and new employers know what's happening so that (for example) you're technically employed by old employer up to the day before you start with the new one (even if that's a sunday) rather than tell them after the event.

ultimately, i'd be inclined to suggest talking to union and HR (both at current and new employer)

will need careful handling to get the best outcome.

local government t & c have moved on since i was directly employed (oh shit - nearly 15 years ago) - 'single status' was at a fairly early stage, and more authorities have opted out of the national agreement since then.

the more i think about it, the more i think that you can't get redundancy now based on (say) 5 years service then get another redundancy in 5 years' time based on 10 years service.

She's not resigning. Her new job starts immediately after the date her current job ends.

 

[Puddy_Tat]

She's checked with her union and they said she will get the payout, but she's researched it independently and thinks she's been misinformed.

lay union reps are sadly not infallible - when i was a rep i tended to take the "i'm not entirely sure, let me check with branch office and i'll get back to you" sort of approach where necessary. i've seen reps get themselves into a tangle because they wanted to appear to know the answers...

She's not resigning. Her new job starts immediately after the date her current job ends.

i see. think she'll need to advise both employers what's going on. worst case would be losing the redundancy pay-out and lousing up the continuous service...

 

[Miss-Shelf]

Ring acas

 

[Puddy_Tat]

Ring acas

but make it clear it's two local authority jobs. that may make a difference.

 

[Guineveretoo]

The situation in local government is as several people have said - your friend is not entitled to redundancy pay if they take up employment in another local authority.

This is because continuity of employment goes across local authority employers. The relevant paragraph in the guidance follows:

"If the authority gives the employee notice of redundancy and before the dismissal takes effect the employee accepts an offer of employment from another body specified in Part II of Schedule 2 of the Redundancy Payments (Continuity of Employment in Local Government, etc.) (Modification) Order 1999, the individual will lose entitlement to a redundancy payment.

This only applies where the relevant body makes the offer of a new job before the end of the old contract and the employment starts within the four weeks after the date of redundancy.

Authorities are therefore advised to seek written confirmation from the employee that they will not be taking up any other employment covered by the Modification Order within four weeks after the date of redundancy.

Note: under s.146 of the ERA if the contract ends on a Friday, Saturday or Sunday, it is treated as ending on the Monday of the next week."

Your friend may wish to take proper advice to determine whether she may be better to negotiate a break in service so that she can still get redundancy, but this may not be allowed, and is usually not to the advantage of the individual anyway because of the loss of employment rights.