Employer dodging redundancy settlement

[pegasus.uk]

Hi all,

I have commuted 30 miles a day for the last 6 years to work as the manager of retail outlet, which is a concession within a larger store, and after many months of whispers and speculation my staff and I are being made redundant at the end of this month because the main occupant has decided to utilize the whole unit.

Regarding my own situation, although the parent company has vacancies available in other outlets nationally, none are within a reasonable commute, and although they are pursuing the possibility of opening a new outlet closer to home they don't immediately have anything suitable to offer me.

BUT, through the grapevine, I have heard that a store in my home-town, owned by the parent company (but different name and product) has an up coming vacancy for an assistant manager (lower salary, different duties, and lesser responsibility) that won't be available until September. I contacted the manager of that store expressing an interest in the vacancy and was informed that if I made a successful application for the position, and because of my exemplary track-record, they may consider releasing the outgoing employee a little earlier than her required 3 months notice.

Because of my interest, I have since been contacted by the HR department of the parent company and have been told that if my application is successful, and if I were to take the position, I would loose my redundancy settlement (5 weeks pay and have to work through to the end) even though I would still have several weeks of unemployment before commencement.

Can they do this?

[matt3942]

Re: Employer dodging redundancy settlement

Hi [MENTION=68420]pegasus.uk[/MENTION] - welcome to the forum.

My initial thought is yes they can because your employment with the company would continue, albeit on different terms, so effectively you won't have been made redundant.

If your application is unsuccessful, and the company cannot offer you a suitable alternative, you will still have a right to your redundancy settlement.

- Matt

[pegasus.uk]

Re: Employer dodging redundancy settlement

...your employment with the company would continue...

Thanks for the reply Matt, though it has left me feeling a little confused.

We have all been given our redundancy notices, we cease trading on June 25, have to assist in transferring out remaining stock, fixtures and fittings until June 27, and will need to sign on as unemployed on June 29 (only one of my girls has been lucky enough fall into another job in the same retail park).

Baring in mind that I have not been offered this position as a suitable alternative, how can it be considered 'continued employment' if the job will only be made available In August at the earliest on the premise that I make a successful application?

Thanks - Pegasus

[matt3942]

Re: Employer dodging redundancy settlement

Hi [MENTION=68420]pegasus.uk[/MENTION]

That is my understanding. Your employer might have not offered the alternative role to you if they didn't consider it to be a suitable alternative; however, if you apply for it they are likely to argue that you considered it to be a suitable alternative. The employer would then simply regard it as a redeployment within the group of companies.

If there are two or more employees being made redundant it's normal for them to have to apply for suitable alternatives.

I also think there are tax implications to taking a redundancy package and then being re-hired by the same employer. HRMC might try to recover the tax that would have been payable on your redundancy package.

You might benefit from contacting ACAS or CAB for clarification on your position and rights.

- Matt

[pegasus.uk]

Re: Employer dodging redundancy settlement

So I can assume then that if, ...

1. ... in the next couple of weeks, I gain employment with a different company I'll be entitled to keep my redundancy pay.
2. ... after several weeks of unemployment, I get the position previously discussed I'd likely have to forfeit my redundancy pay.

Regarding point 2, surely there must be some cut-off point as to what can be considered as 'continued employment'; what if I were not to get that position but they did open a new store several months down the line and they approach me to re-apply for the position of manager, would I have to pay back my redundancy then?

Thanks - Pegasus

[matt3942]

Re: Employer dodging redundancy settlement

Hi [MENTION=68420]pegasus.uk[/MENTION]

1 - Yes, if you secure employment with an unrelated company you will be entitled to keep your redundancy package.
2 - That is my understanding but a professional legal adviser will be able to clarify.

I'm afraid I don't know the answer to your question. You might be better off asking your employer what their policy is. My understanding is that if you are made redundant and then re-hired there are tax implications and HMRC may suspect wrongdoing of sorts. As far as I'm aware the employer takes this risk, which is why in this instance it's 'safer' for the employer to withdraw your redundancy package and give you continuity of service.

IMO if you applied for a post several months down the line it wouldn't affect your redundancy package; however, I would ask the question.

- Matt

[des8]

Re: Employer dodging redundancy settlement

The advantage to the poster in not keeping the redundancy payment is that he has continuity of employment and so retains the two years of service required for possible future claims of unfair dismissal.
Here's a link to the view from the employer's side, which you might find useful:http://www.cipd.co.uk/pm/peoplemanag...s-2009-08.aspx

[teaboy2]

Re: Employer dodging redundancy settlement

I think the OP should apply for the position as its clear they want you too and therefore likely your application will be successful. It would be deemed continuous employment, assuming the parent company is your employer (pays your wages)?

As for the duration between 27th june and August when the new position is available - Well they did say they may let the person currently working their notice leave, i.e. pay them in lieu of remaining notice, which would allow you to take over the role straight away instead of waiting to august. Alternatively the company may give you paid time off or unpaid time off (unpaid time off being called temporary lay off). Either way, it will still be continuous employment as your basically moving between associate employers, only in this case the employer is the same employer, and your moving between stores instead. And if your given unpaid time off then its temporary lay off which still counts as continuous employment!