redundancy


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redundancy

the termination of an individual's employment when the employer ceases trading or the job ceases to be required because of rationalization, change of product etc. When an employer decides to make part or all of a workforce redundant the European Collective Redundancies Directive requires that the workforce be consulted on the extent, distribution and rationale for redundancy. Advance notice must be given with the extent of this dictated by the number of planned redundancies. Consultation must take place with union representatives, specially elected employee representatives where a TRADE UNION is not present, or (exceptionally) directly with all employees.

Employees with more than two years' service are statutorily entitled to a redundancy or severance payment. For adult employees under 40 this is one week's pay for each year of service, for those of 40 plus it is one and a half week's pay for each year up to a maximum of twenty years. Many employers choose to make payments substantially above the statutory level (in some public sector organizations there are special schemes to support this) to sweeten the pill of redundancy.

Selection of employees for redundancy can be a traumatic process and, if the organization is to continue trading, needs to be conducted fairly if the morale of those remaining is not to be irretrievably dented. A favoured option is to seek voluntary recruits for redundancy among older employees, backed up by generous redundancy payments and possibly early access to pension benefits. An alternative method is ‘last-in-first-out’ (LIFO),i.e. those with shorter service are selected for redundancy. Whilst superficially fair the problem with this is that it potentially removes those young workers who have most to offer the organization in the long term.

Whatever the method chosen, redundancy is undoubtedly a distressing process for all those involved. Some more progressive organizations offer counselling services to aid adjustment and to rebuild confidence. Others, especially where very large numbers have been made redundant, have set up employment agencies in an attempt to find alternative work. Although trade unions sometimes declare their intention to fight redundancies, they and their members are generally unwilling to take any form of industrial action since this could imperil redundancy payments. Unions, therefore, usually come to devote their efforts to ensuring that individuals are treated fairly by those handling the redundancy process.

redundancy

the loss of jobs by employees, brought about by company RATIONALIZATION and reorganization that results from falling demand or PRODUCTIVITY improvement. In the UK, adult employees under 40 years of age are entitled to redundancy or severance payment of one week's pay for each year of service, and for those over 40, it is one and a half week's pay for each year up to a maximum of 20 years. See UNEMPLOYMENT.
References in periodicals archive ?
The Scottish Government's Partnership Action for Continuing Employment (PACE) initiative can help with the practicalities of redundancy as well as the emotional implications.
Wherever there is a redundancy situation, consultation is usually close by.
To sum up, the important and critical problem to be solved is how to find an effective way to detect and eliminate the redundancy related to combining algorithms accurately and then improve the evaluation performance of the PDP.
A BUCU source told the Post last week: "The members of staff placed at risk of redundancy, however, contributed substantially to teaching, have brought in more than PS8 million grant money and have published more than 350 research papers over the last five years.
In South Wales, Cardiff and Vale University Health Board has spent PS785,140 on nine redundancies since 2011-12, while Abertawe Bro Morgannwg Univer-sity Health Board said it had paid out PS211,000 over the last three years in redundancy payments to less than 10 staff.
The labour ministry said on Wednesday that the number of pending redundancy payments was reduced to 15,301 in October, from 16,308 in September.
The Contractor shall contact then the employee over and takes care information to the employee regarding the terms and conditions that are required to be able to proceed to the (timely) payment of the redundancy pay.
Unless the employee could show that the redundancy was a sham, motivated by a desire to exit an employee for reasons other than redundancy (for example, poor performance), the Courts tended not to interfere.
Those who applied for voluntary redundancy will leave on or before December 17 this year, and those who did not will leave on or before June 17 2014.
CHRISTMAS special: On the first day of Christmas this Government gave to me a redundancy in a Remploy factory.
DOZENS of council staff have received staggering six-figure redundancy packages after leaving local authorities in Wales, we can reveal.
TEACHERS at the centre of a redundancy tug-of-war could finally be put out of their financial misery - but only if they accept a proposed pay off.