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Original poster

Redundancy and Settlement

19 replies

Issania87 · 06/09/2023 19:15

Hi,

I am after advice for my Mum.

She is 60 today was told she was being made redundant. They have offered her a settlement and told her she has 7 days to sign it.

She was not told she was at risk. She has not been offered an alternative role or the opportunity to appeal. Just given the settlement agreement and told to sign it.

Surely it can't be legal to do this?

She feels that she has no choice but to take the settlement as financially she needs it especially as she is worried it will be difficult to find a new role because of her age. But she really does not want to sign it.

Does anyone have any idea what she should do?

OP posts:
LampHat · 06/09/2023 19:17

How long has she worked there?

JustFrustrated · 06/09/2023 19:34

Questions

How big is the company? This determines how and when and even if they need to do consultancy about redundancy.

I believe the company need to offer independent legal advice that they will pay for.

Sisterpita · 06/09/2023 19:58

@Issania87 for a settlement agreement your Mum has the right to get her own legal advice funded by the employer. She needs to contact ACAS immediately.

HermioneWeasley · 06/09/2023 20:04

Sisterpita · 06/09/2023 19:58

@Issania87 for a settlement agreement your Mum has the right to get her own legal advice funded by the employer. She needs to contact ACAS immediately.

This is not correct - for it to be binding your mum must get independent advice. This is usually a solicitor paid for (C£300-500) by the company, but that is not a requirement.

has your mum been offered more than stat redundancy pay? Usually when companies do it like this, they are paying more than they have to so there’s no point arguing.

Sisterpita · 06/09/2023 20:35

@HermioneWeasley I keep forgetting I worked for decent employers who always paid.

Bromptotoo · 07/09/2023 00:12

As above. Professional advice needed. ACAS as a start.

Isitover23 · 07/09/2023 05:08

Hi @Issania87.

Assuming your mum has worked for the company for 2+ years (I expect she has long service), they have to follow a process if they consider her role is at risk of redundancy. If less than 20 people are affected by the restructure, then they do not have to go through a ‘collective’ consultant process, but still have to consult with your mum on an individual basis. This should involve explaining why they consider her post is at risk (they should be able to show why her post differs from other peoples) and what measures they have taken so far to mitigate against potential job losses. They would then need to meet with her as part of the consultation. From your OP, I don’t think they’ve completed this process yet. Has she asked/been given a rationale letter/document or and policy etc?

in terms of the settlement agreement (SA), your mum DOESN’T have to agree to anything! A SA is offered on a ‘without prejudice’ basis, and is often offered to avoid going through redundancy processes (which takes time and there is some risk to employers as employees can bring unfair dismissal or discrimination claims). But, there is no legal requirement for you mum to even enter into a without prejudice conversation with them. She could simply say, “sorry, I’m not interest I want to explore alternatives to redundancy”. However, if she does that and they are offering more than statutory, she may loose any additional severance payment they are offering as part of the SA.

I would suggest she seeks initial advice and then asks to have a meeting with them as part of the offer to discuss whether there are any alternatives to the redundancy (if she wants to stay). This can be as part of the without prejudice offer if she wants as the employer may be more open with her than if it is “on the record” as part of the redundancy consultation (as they have to show termination is the last resort even if they know there is no other option).

as PP said, there is no requirement for the company to pay for independent legal advice (which is compulsory for the SA to be legally binding), but most contribute circa £350 towards advice, which usually covers solicitor fees.

hope that helps, happy to answer any other questions you may have.

Original poster
Issania87 · 07/09/2023 19:45

Hi all,

Thank you for all your replies.

Mum has been there 5 years. They are offering a settlement of statutory plus 1 month additional notice.

She called Acas who said that as it involved a settlement agreement she had to get legal advice and they couldn't help.

She spoke to her solicitor who basically said she could have a case for age discrimination but it would take £20k in the bank to fight it which she doesn't have.

So she feels like she has no option but to sign the agreement because at least the additional notice is something to help cover the bills!

OP posts:
PinkTonic · 07/09/2023 20:00

She can negotiate the settlement, she doesn’t just have to accept their first offer. Why would she think age discrimination, is there evidence of that? Does she do a similar job to others and has been singled out for redundancy without a proper process? I would go back with a list of questions and they may increase the offer if there is a risk.

Isitover23 · 07/09/2023 20:09

@Issania87 I totally agree with @PinkTonic. Companies will usually go in with the lowest offer, but there is room for negotiation. If she can detail the main points of her argument and explain why she feels disgruntled by the way they’ve handled it etc, and then set out what she feels is reasonable, they will likely come back with a counter offer.

Did her solicitor not give any advice in this regard, as opposed to just stating there may be a potential discrimination claim? I’m surprised if they didn’t.

Sisterpita · 07/09/2023 23:08

@Issania87 I would ask for 6 months notice and aim to settle at 3 months.

Your mum needs to argue this has come completely out of the blue and having just turned 60 she is going to find it a lot harder than younger colleagues to find a new job.

StargateSurvival · 10/09/2023 00:51

If your DM is in the UK
Once she has her redundancy money & P45, she can claim contributions based job seekers allowance, which about £80 a week. Her redundancy money will not be taken into account for a certain time period. Apply under universal credit www.gov.uk. This is if she is not working

She should also ask her employer for contacts to provide a reference that can use on her CV for future employers

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StargateSurvival · 10/09/2023 04:33

If your DM claims job seekers, this also pays her National Insurance "stamp" towards state pension & other benefits too

CrazyHamsterLady · 10/09/2023 13:11

I took voluntary redundancy from the NHS a while back. It was a long drawn out process and, as part of the legalities, my employer had to pay for a solicitor to look over the agreement and explain it to me. They have a choice of two or I was free to choose my own and the solicitor invoiced them. She shouldn’t have had this just landed on her and there shouldn’t be a rush to sign. Legal advice should definitely be sought.

Original poster
Issania87 · 11/09/2023 18:15

Hi all, so she went back to her company stating what the sols had told her to say and how challenging she will find it given her age and asked for 6 months pay as settlement (hoping to settle on 3) in light of all this and her hard work over the past 5 years.

They have come back saying they disagree and the redundancy was not based on age but on timezones (she is the only person with her job title in the UK, although there are other UK employees) and the offer she has is the only offer available. They have said she now has 24 hours to agree or the offer is pulled.

As a result, she is going to sign the agreement because she needs the 1 month salary for her mortgage.

I will let her know about the job seekers, thanks for that advice.

OP posts:
Justbetweenus · 11/09/2023 18:27

But if they pull the offer, then what will they do? They can’t fire her without good reason (they’d need to go through a disciplinary process, for instance, but if there were no grounds it would look a lot like victimisation/bullying). If she needs the job, I don’t think she should sign.

Justbetweenus · 11/09/2023 18:28

Or are you saying she’s getting statutory redundancy plus her notice period plus an additional month?

Oddsoc · 11/09/2023 18:44

It might be worth getting them to be clear on whether the extra months notice is truly extra notice, or is actually enhanced redundancy. I believe there is no tax on the redundancy payment up to £30k (including the extra months ‘sweetener’ if considered enhanced redundancy) but ‘extra notice’ would be taxable.

Id also be asking for the notice to be unworked - called Pay In Lieu of Notice (PILON). Then she gets a lump sum and won’t need to work.

Neither of those ideas cost the employer I think but could help your mum.

oh and she should check if her contract states termination payment will be salary or salary + benefits. If the latter (unlikely) she may be able to persuade them to give her the equivalent of benefits like employer pension benefits or health insurance payments.

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