What is redundancy?

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Redundancy occurs where dismissal is:

• wholly or mainly attributable to the fact that the employer has ceased or intends to cease to carry on the business for the purposes of which you were employed, or in the place where you were employed; or

• the fact that the requirements of the employer for employees to carry out work of a particular kind, or for employees to carry out work of a particular kind in the place where you were employed have ceased or diminished or are expected to cease or diminish.

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The important feature of the definition is not whether the need for the job (“work of a particular kind”) done by the employee has ceased or diminished (or is expected to do so). Instead, the question is whether the requirements for employees to do that type of work has ceased or diminished. In other words, the amount of work needed to be done might remain the same (or may even increase) but if it can be done with less people, then there is a redundancy situation.

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Employers often claim that there has been a reduction in the work needing to be done, but this is not always the real reason for dismissal. It can be cheaper and less time consuming to label someone “redundant” rather than follow, say a performance process that could take many months. 

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What is a Transfer of Undertakings?

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Where a business is transferred from one employer to another, the transfer does not end the employment relationship. Usually, your contract of employment is carried over into the new business, with your existing terms intact (including your old redundancy terms).   If you are made redundant in connection with a transfer, either by your old employer before the transfer takes place, or by the new employer after the transfer has taken place, the employer would have to show that there was a real redundancy and that the transfer was not the only reason (or the main reason) for the dismissal. The rules governing such a situation are found under the commonly known “TUPE Regulations“.