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When making an employee redundant, it is important you understand what you must do as a small business owner.
As a small business owner, you may not have to pay redundancy. You are, however, required to give notice.
Don’t know where to start? Here’s what you need to know.
Redundancy
Redundancy occurs when:
- An employee’s job is no longer needed, or
- The business the employee was working for becomes bankrupt or insolvent
This may be as a result of new technology, a reduced rate of business growth or a business restructure.
Genuine Redundancy
When making an employee redundant, it must be genuine. This ensures that your employee can not make a claim for unfair dismissal.
A genuine redundancy occurs:
- When the employee’s job doesn’t need to be done by anyone once they have been made redundant
- When the employer has followed any relevant requirements and/or the requirements made in an agreement between the employee and employer
A redundancy is not genuine in any of the following scenarios:
- The job you have made redundant still needs to be done by someone
- The relevant requirements haven’t been followed
- The employee you have made redundant could have reasonably been moved to another job within your small business
How Do I Provide Notice?
If you are required to provide notice to the employee you are making redundant, it must be provided in writing.
It is vital that the employee receives the notice of termination. Ways in which you may deliver notice include:
- Personally
- Leaving it at the employees last known address or
- Sending by pre-paid post to the employees last known address
Any Questions?
Making an employee redundant can be a challenging process for all involved. We understand the difficulties you may face when having to let an employee go. Ensuring that you take the correct steps when doing so is vital in making the process as smooth as possible.
If you have any further questions regarding making an employee redundant, we’re here to help! Reach out to our team today at [email protected].
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