Mirror redundancy payments

sawutdee1

Hello
My company is closing down this year, even though we are very busy and making money.
We are a division of a large multi million dollar American company.
The redundancy pay they have offered is two thirds of a months pay per year of service, capped at one years pay.
I'm told this means it's capped at 18 years service.
Obviously the people who have done over 18 years are not happy about this, quite a few have done 25 years and over.
They are not happy at their long service not being recognised and getting the same redundancy as someone with half the service, in some cases.
A couple of people are saying that the company must mirror the statutory redundancy payments
Can anyone shed any light on this please

jdturk

I'm guessing though that statutory which is upto 20 years from memory would be less than 2/3rds pay for 18 years so they could argue they want the redunandcy mirrored to 20 years statutory but its very likely to make them worse of!

mjm3346

Around 30 weeks pay is the maximum for stat redundancy with a limit of 20 years service (and there is a cap of £380 week) as your offer is up to 52 weeks pay it is well above the minimum.

mjm3346

Ready Reckoner for statutory redundancy


http://www.berr.gov.uk/whatwedo/employment/employment-legislation/employment-guidance/page33157.html

happywarmgun

The only way they would be able to get a better deal would be if your company had a long standing, published, redundancy policy which set out higher expectations (i.e. didn't mention capping) - even then it wouldn't be as straightforward as waving the policy at them to get it.

It does sound inequitable, but it is also better than many get.

getmore4less

Another thing to try for is PILON.

sawutdee1

Hello thanks for the replies

The company used to pay better, in years gone by people got 4 weeks for every year, no cap, others after got 4 weeks capped at 24 years. But the last few people who have been made redundant have got the same as we are being offered.
I am surprised they are going to give us the years pay when there are about 60 of us going.
We tried in the consultation period to get more but the company wouldn't budge. Some think they have got the company on this mirror thing, but I am not so sure.

Thank you

getmore4less

Since there has been varying terms for previous rounds and the recent rounds were on the same terms as now it is unlikely you could try a custom and practice claim for better terms.

exil

I think there is often confusion between statutory redundancy, and the sort of payment talked about here, which is an ex-gratia payment not guaranteed in the contract of employment (in the weird world of telephone number salaries a big "golden goodbye" is very common, but it's not technically a redundancy payment as it is agreed when the employee starts the job). It has to be ex-gratia in order to qualify for the 30k tax-free allowance. In essence the company can give as much or as little as it likes as long as it's equal to or more than the statutory, which this is, and it can make up the rules as it wishes.

My own employer is obliged to top up the pension scheme of anyone aged 50 to 65 to buy out actuarial reductions but that's it other than statutory. Depending on circumstances we might get more than this but it's not guaranteed.

sawutdee1

I have seen how they layout the figures for employees made redundant in the past. It is as you say above, statutory redundancy with an ex-gratia payment at the bottom.
We have nothing written into our contracts of employment about redundancy payments, so I can't see how these people think they are going to win, but they are convinced they are.
We also asked in the consultation meetings if they would top up the pensions but they wouldn't budge on that either.
They did agree to take into account the night shift premium, which is an extra 33% on top of their basic pay.
I think the problem is that those of us with long service are mostly in the late 50's early 60' age group,we see people younger and with less service getting the same money.
In my own case,I work in the laboratory and I am a cross between a salaried office worker and a DMC factory worker.We get paid slightly more than the factory but less than the salaried office staff. We work the same hours as the office get private health care, but because they wanted the laboratory technicians to cover the 24hr production testing they paid us overtime which the office staff don't get.
So now I find that someone in the office who I was told was on the same level as me, has done 11 years less service, is 20 years younger and has no qualifications will be getting more redundancy than me, which doesn't seem fair.
But then as I keep telling my son, when he says that's not fair when i tell him to do things, life isn't fair

Thank for all your comments.

getmore4less

Do you have final salary pensions?

Even though they won't enhance the pensions they may allow you to put redundancy money in to enhance them, handy for the money that will be taxed(>£30k) as long as they don't sting you.

It may be possible to put the money in and get some back tax free and have an enhanced pension depending on the scheme and how they calculate the comutations(sp).

This would need proper advice.