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'Ordinary Redundancy' vs 'Medical Redundancy' which is better ££??

15 replies

medianewbie · 20/06/2023 15:46

I am Divorcing. STBExH walked out nearly 2 years ago. Left me with 2 DLA High level disabled young people (I get Carers allowance & Income Support) No maintenance paid & barely any contact with kids, certainly never 'takes them'.

My STBExH stopped work around 9m ago due to Anxiety & Depression
(periodic over his 25 yrs with the firm always returns to work. This time - not).
He says his firm offered him a 'medical redundancy' a few weeks ago, but now it is being considered by Occ Health & he is waiting to hear. He says that he will get a 5K payout for a standard redundancy (after 25 years with LA employer?) but if he is allowed a medical retirement he will get the same but more into his pension pot. Therefore he wants to wait to see how much it is.
He has no lawyer (refuses one). He won't reply to my lawyer. He is very stubborn.

Is he correct in what he claims?
I understand that the decision is 'due any day' so probably not time to get the Minute of Agreement signed first anyway.

OP posts:
medianewbie · 20/06/2023 17:11

Anyone ?

OP posts:
HermioneWeasley · 20/06/2023 17:15

Difficult to know as each employer will have their own scheme but often an Ill health retirement (never heard of medical redundancy) will have no lump sum but effectively an early pension. It’s very hard to get unless you are very close to retirement age

TitInATrance · 20/06/2023 17:16

What he says would have been correct in my ex-public sector employer some years ago. I don’t know the current situation or the specifics of your DH’s scheme but it is credible.

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LIZS · 20/06/2023 17:17

Medical retirement may give him additional years contributions towards pension. Your solicitor may be looking for a share of his pension pot.

KnickerlessParsons · 20/06/2023 17:29

His redundancy payment sounds suspiciously low, and I've never heard of a medical redundancy.
🤔

MrsMoastyToasty · 20/06/2023 17:38

Minimum redundancy payout is 1 weeks pay for each full year (part years don't count) served with the employer. It goes up to 1.5 weeks pay per each full year served over the age of 40. I only know this because I got made redundant in 2022.

NeverDropYourMooncup · 20/06/2023 17:38

He will be dismissed due to capability. Not made redundant - because he isn't, he's incapable of doing his job/coming into work.

Then they will consider the Occy Health recommendation as to whether he will be capable of working again in the near future, the medium term or ever again. And decide whether he should receive nothing other than accrued holiday and last salary payment (probably about five grand...) or if he should get Tier 1 or tier 2

The LGPS states that ((4) A member is entitled to Tier 1 benefits if that member is unlikely to be capable of undertaking gainful employment before reaching normal pension age. (5) A member is entitled to Tier 2 benefits if that member is likely to be able to undertake gainful employment before reaching normal pension age.”

He should be attending a dismissal hearing once the report is received, preferably with a union rep and should be aware that it's possible that they would decide he could get better again and be able to collect trollies in a supermarket car park or do office cleaning a couple of days a week, even if he isn't likely to be able to do his original role anymore.

for example, Edinburgh council's terms are

If it’s decided following an Absence Meeting 3 that there’s nothing more can be done to help you return to work, or that your short term absence levels are no longer sustainable, then it’s possible you will be dismissed on the grounds of capability due to ill-health. This decision would only be taken after all mitigating factors, reasonable adjustments and redeployment possibilities had been explored. Note that Absence Meeting 3 can only be held by a senior manager with the authority to dismiss. If you are dismissed on the grounds of capability due to ill-health, you will receive payment for any outstanding annual leave you have, as well as payment in lieu of notice.

Ill-health retirement (pension scheme members only)

If you are a member of a pension scheme (LGPS/STSS), below normal retirement age, and advice from Occupational Health is that you are permanently unfit to carry out the duties of your post, you may be dismissed on the grounds of capability due to ill-health with access to pension benefits. This is known as illhealth retirement. The pension benefits you would be able to access through ill-health retirement will vary depending on whether, according to medical advice gathered by Occupational Health, you are likely to be able to work again before your normal retirement age. Details of the relevant pension benefits levels are outlined in the Sickness Absence User Guide.

https://www.edinburgh.gov.uk/downloads/file/25965/sickness-absence-policy#:~:text=Capability%20dismissal&text=If%20you%20are%20dismissed%20on,sick%20pay%20has%20run%20out.

I'd be very suspicious, because it is not common for somebody to be granted full, never going to be able to work again for the rest of his life, Tier 1 benefits for anxiety and depression.

https://www.edinburgh.gov.uk/downloads/file/25965/sickness-absence-policy#:~:text=Capability%20dismissal&text=If%20you%20are%20dismissed%20on,sick%20pay%20has%20run%20out.

LIZS · 20/06/2023 17:39

25 years service would be way over £5k - statutory minimum is 1 week for every year, 1.5 for every year over aged 40, plus payment in lieu of notice period.

Shellymay · 20/06/2023 17:56

I was finished on health grounds in 2000. I’d worked for the company for 10.5 yrs. I was given a small payout of about £2,600, but because I was deemed medically unfit to work they also continued to pay into my pension. Not sure this helps as it was 23yrs ago and things will have probably changed a lot since then

medianewbie · 20/06/2023 18:08

Thank you everyone who has replied, (especially @NeverDropYourMooncup as details sound quite similar: it's LRT)

The exact figures are 23 yrs & £550 pw gross. He is 58, so most of that will be at 1.5xwkly wage so, not sure if they use gross or net earnings, & my maths is bad, but more than 5k anyway !!

It sounds like Tier 2 he's trying for. He was offered some seasonal work (on a new contract) but said no. He said they offered him redundancy (this is where '5k & I'd have to pay tax' comes from) but then said he might as well wait till he hears back from Occ Health. He seems to think it will be fine (but he's not spoken to his Union or CAB).

If he gets Tier 2, will there be a bigger pension pot to divide?
If he doesn't, will he get the redundancy figure (whatever that works out as) & can I claim any of that, does anyone know?

I know this might sound grasping but he's absolutely dumped me in it (he's well enough to have some nice hobbies & go on his holidays but not well enough to look after or pay for his kids)

OP posts:
LIZS · 20/06/2023 18:26

Redundancy pay up to 30k is not taxable. The role is made redundant not the person so it may not be a redundancy situation anyway.

medianewbie · 20/06/2023 18:39

@LIZS - he's a bus driver. DVLA won't consider renewing his licence (bus or car) 'for at least another 6m' so he can't get to work or do his work.
It all seems quite 'major' for Anxiety & Depression but that's what he says so that's what I have to go on. I'm sorry he's had a tough time - I'm aware he says he felt suicidal last autumn as he asked me to support him through (I did) but I'm also aware he only considers himself & is definately looking forward to retirement. Good for him, but he needs to consider the kids.

OP posts:
MrsBennetsPoorNerves · 20/06/2023 18:53

It's a capability issue rather than a redundancy situation. Unless they are reducing the overall number of bus drivers that they employ, he cannot be made redundant. His role still exists. Statutory redundancy entitlement is therefore irrelevant.

So he will be dismissed on the grounds of capability. The employer might offer some kind of severance pay but they don't have to pay anything above his accrued leave and notice period.

I would be really surprised tbh if he managed to get full ill health retirement on the basis of anxiety and depression. Surely you can't know that someone is going to suffer with depression and anxiety indefinitely? So where is the evidence that he won't be able to work again?

medianewbie · 20/06/2023 19:08

@MrsBennetsPoorNerves
Ah, OK, I see what's meant now re this.
Perhaps that's where the 5k figure comes from?

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