COVID-19: Lay-off and redundacy

Businesses are looking to reduce their bills in response to more people self-isolating at home.
While some send their employees to work from home maintaining their wages, others take advantage of lay-offs and reduced working hours.

Although there is general guidance available to employers, we suggest you seek legal advice before taking any actions and changing employees’ terms. Otherwise, you may face fines and costly tribunal hearings.

What about 0-hours workers?

0-hour workers cannot be suspended from work without a mutual agreement. If you decide to do so, you are opening up your company to claims. Otherwise, the right to suspend should be clearly stated in the contract.

Can I make employees stay home for a period of time on a reduced pay?

As an employer, you require a contractual right to do so and will need to follow the contract change process. You must also seek agreement from employees. Be transparent about why you have to do so and what employees can expect in the future, including redundancies.

What is lay-off?

Lay-off is when you as an employer take an employee off work at least for one working day due to lack of work.
Lay-off can trigger redundancy if it lasts for 4 weeks in a row, is more than 6 weeks within a 13-week period. In this case, an employee may opt for redundancy, and therefore, will be eligible for a redundancy payment.
Statutory lay-off pay: up to £29 a day for five days in any three-month period – so a maximum of £145.

If you have to make your workers redundant, you have to follow the redundancy procedure.

Find out more about your rights by contacting us.

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