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As an employer we are being forced from the employee to make

Resolved Question:

As an employer we are being forced from the employee to make her redundant as she is having a financoal crisis - where do we stand
Submitted: 4 years ago.
Category: UK Law
Expert:  Thomas replied 4 years ago.

DearCustomer

 

Thanks for your question.

 

Could you please clarify what you mean by "as she is having a financial crisis"? The reason I ask is that although redundancy is one of the potentially fair reasons for dismissal an employee can have a claim for unfair dimissal if they were unfairly selected for redundancy. This is plainly something you want the company must protect itself from by ensuring a fair selection process.

 

ACAS provides lots of useful infomation for employers who are considering making redundancies (I'm sure you appreciate there is quite a lot of literature on the subject) and I woudl advise familarising yourslf with it before making official action:-

http://www.acas.org.uk/index.aspx?articleid=1611

 

 

If the employee has been employed with the company for two or more years then they will be entitled to a statutory redundnacy payment, unless the contract of employment (or other agreement) imposes an alternative method of calculating the redundancy payment that they are owed (note this cannot be less than the statutory minimum). You can use the following calculator to work out what the employee would be statutorily entitled to:-

http://www.berr.gov.uk/whatwedo/employment/employment-legislation/employment-guidance/page33157.html

 

I hope this helps, if so please kindly click accept so that I may be rewarded for my time. It will be gratefully received and you will be free to ask follow up questions.

Kind regards,

Tom

Customer: replied 4 years ago.
This employee was employed by us to work for two companies that run beside each other. Contracts have been issued to show that 20 hours are to be worked on each company each week. We started redundancy proceedings for one of the companies as it needed to cut it's costs. The employee has consulted ACAS and has been to citizens advice who have siad that as she has received her salary paymnets from the company that is not making her redundant that she is only employed by that company (cross charges are made to the other company for half her salary). That company has not and was not going through the redundancy process. Howeve this employee has said that she needs to be made redundant as she and her partner have got into financial difficulties and the only way out is to be made redundant. She also says that work has become untenable for her. We are being forced in this respect to give her redundancy as she is asking for this redundancy. Where do we stand as an employer as surely this is not legal?
Expert:  Thomas replied 4 years ago.

HiCustomer

 

Thanks for your reply.

 

Tell me about the employment contract, does it state than she is employed by the company who is not making redundancies but that her role is to be split in working hours between both companies?

 

Is there anything to suggest that she is employed by the company that is making redundancies other than the fact that she does work for them?

 

You have to build up a picture of her employment relationhip beng with the company that is not making redundancies (think of all examples - where is her manager based, who does she have to request leave from, sickness, reviews etc). If you can show that the contract of employment is with the company not making redundancies then you are not under any obligation to make her redundant. If she is in financial difficulty then that is, sad to say, her personal problem. If she say the work has become untenable then she can give her notice to terminate employment with you.

 

Kind regards,

 

 

Tom

Customer: replied 4 years ago.
Yes both contracts for both companies state that she would be working 20 hours per week with an annual remuneration of £10000 - making £20000 per annum in total from both companies. Point two "Is there anything to suggest that she is employed by the company that is making redundancies other than the fact that she does work for them?" - only by her contract as i have been paying her from the company that is not making her redundant - she is the only employee in the office and she is the operations manager for both companies. All the e-mails that we get are ccd in to every one - ie all the directors - re the company that is not making her redundant - we are directors of both companies and on the company that is making her redundant there is another two directors who are just directors of that company.
Expert:  Thomas replied 4 years ago.

Right.

 

If she has a contract with the company that is making redundancies, do you still require her to continue working under that contract? ie. are you or are you not intending to make her redundant from that company?

 

Tom

Customer: replied 4 years ago.

She has a contract for 20 hours per week for the company making her redundant. We do not require her to continue to work under that contract. We are making her redundant from that company to reduce costs. You should know that although she has had both contracts for months she has signed neither.

Expert:  Thomas replied 4 years ago.

It doesn't matter that she has not actually signed the contrac, she still has a contract with the company as an employment can either be in writing, oral or a mixture of both.

 

If you are making her redundant from that role, then you should calculate her redundancy payment on the basis of her pay from that company.

 

It's better to engage with her and tell her that you believe she has two contracts of employment, albeit that she received money from just one company, and state that you will pay her redundancy payment from that role but not from the other (if that is what you wish).

 

Please click accept.

 

Tom

Thomas, Lawyer
Category: UK Law
Satisfied Customers: 6592
Experience: BA (Hons), PgDip, Practising Solicitor
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