AM Online

Reorganizing structures can lead to redundancy

It is important that employers understand the difference between a lay-off and a redundancy. The main point being that a lay-off is temporary while redundancy is permanent.

A business can make an employee redundant if there is no longer a need for the skills for which the employee was taken on, or if a business is reorganized to improve its efficiency.

Steve Dewison, managing director of Brunswick Group, says: “It can also be the case that redundancy is a thinly disguised method of dismissal. Under such circumstances, the company needs to have followed the correct procedure in disciplining the individual prior to dismissal.”

An employee can not simply be laid off. A lay off can only occur if there is a collective bargaining agreement that is mentioned in the contract or if the employer has an outright contractual right to do so.

If an employer lays someone off outside these rights, then the affected party is entitled to resign and claim constructive dismissal.

When employing staff, this information needs to be clearly conveyed, as the future is never certain.

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