redundancy pay...pro rata or hourly rate...

badlespoon

Hi there, newbie here.

Wanted to get some advice from you guys if possible please.

My company is going through redundancies at the moment...luckily I recieved a letter yesterday to say that my matrix score was high enough and I was not in the pool for the next round but some of my dear friends weren't so lucky. I really don't want them to get screwed over by the company.

We get an hourly rate, so 35 hours a week at £#ph. But we are an education setting so our wages are then pro-rata'd. We work 39 weeks a year. We are full time.

We get our 39 weeks + holidays added together and then divided by 12 to give a monthly wage. If we are off sick they take our hourly rate off us not our daily pro-rata'd rate. If you're off sick for a full calendar month then you can actually end up owing them money!!!!!

So my questions is.... Should redundancy pay be worked out at the pro-rata'd rate that I actually take home a month or the hourly rate.
This makes quite a difference to the final amount they would get so any information would be great.

As I said my company will screw them over if they can get away with it so just want to check where we stand.

Hope this makes sense.

Many thanks

Badlespoon

LittleVoice

badlespoon wrote: »

Hi there, newbie here.

Wanted to get some advice from you guys if possible please.

My company is going through redundancies at the moment...luckily I recieved a letter yesterday to say that my matrix score was high enough and I was not in the pool for the next round but some of my dear friends weren't so lucky. I really don't want them to get screwed over by the company.

We get an hourly rate, so 35 hours a week at £#ph. But we are an education setting so our wages are then pro-rata'd. We work 39 weeks a year. We are full time.

We get our 39 weeks + holidays added together and then divided by 12 to give a monthly wage. If we are off sick they take our hourly rate off us not our daily pro-rata'd rate. If you're off sick for a full calendar month then you can actually end up owing them money!!!!!

So my questions is.... Should redundancy pay be worked out at the pro-rata'd rate that I actually take home a month or the hourly rate.
This makes quite a difference to the final amount they would get so any information would be great.

As I said my company will screw them over if they can get away with it so just want to check where we stand.

Hope this makes sense.

Many thanks

Badlespoon

I would suggest that neither the monthly pay nor the hourly rate should be used.

The reason is that you work 39 weeks of the year but would also be entitled paid holiday. So the annual pay should be divided by the number of weeks and holiday (not 52 weeks).

Is there a contractual redundancy scheme which is higher than the statutory one? If not and it is therefore the statutory scheme, remember that there is a maximum weekly amount in any case.

I would be interested in the opinions of others on this one.

getmore4less

LittleVoice wrote: »

I would suggest that neither the monthly pay nor the hourly rate should be used.

The reason is that you work 39 weeks of the year but would also be entitled paid holiday. So the annual pay should be divided by the number of weeks and holiday (not 52 weeks).

Is there a contractual redundancy scheme which is higher than the statutory one? If not and it is therefore the statutory scheme, remember that there is a maximum weekly amount in any case.

I would be interested in the opinions of others on this one.

I see you fixed the 5.6 error.

statutory weeks pay is 35 * hrly rate capped at £400.

badlespoon

Hi there,
I did say that we are also entitled to the holiday pay in my original post.

Thats what I thought...... that it should be based on the hourly rate, so, thankyou Getmoreforless. Do you know if there is any where I can get confirmation of that in a slightly more formal manner. Just means that I can arm my colleagues with a bit of info for their meetings.

My work have been sneaky before when it comes to ssp and holiday entitlements, i.e people not getting their 1/12th holiday pay when off for longer than a month, and the same with maternity pay. When I had my first son 5 years ago I didn't get any of it, so I lost 6/12ths of my yearly entitlement. When I had my second son 2 years ago I realised that something wasn't right and spoke to them. They had to give me the extra few weeks off and they weren't happy. Since then, I always make sure people get what they are entitled to, whether it be maternity or sick.....

Thanks for your replies

B X

hcb42

Incidentally, it is correct they take the hourly rate off you if you were sick.

getmore4less

Do you know if there is any where I can get confirmation of that in a slightly more formal manner. Just means that I can arm my colleagues with a bit of info for their meetings

Employment act definition of a weeks wage for redundacy
http://www.legislation.gov.uk/ukpga/1996/18/contents

http://www.legislation.gov.uk/ukpga/1996/18/part/XIV/chapter/II

There are quite a few links off to other pages some maybe relevent and it gets complicated but the key section is 223.1

223 Supplementary.
(1)For the purposes of sections 221 and 222, in arriving at the average hourly rate of remuneration, only—
(a)the hours when the employee was working, and
(b)the remuneration payable for, or apportionable to, those hours,

What this says it that the monies paid when not working or on holiday are apportiaonable to the working and holiday hours , no calculation needed since those moneys were calculated from a 35hr week at £X per hour(spreading over 12 months.

Remember depending on the exact dates you may be entitled to more monry.

eg if term time an the year is Sept to sept if they make you redundant in July you are owed pay upto Sept.



Now there is a potenial gremlin which I have not worked through is if they try to claim the variable hours or the relevent week is a week you don't work I think it may be OK but throw this at them first*****.

***** wait for second opinion, anyone going to agree with this or have I missed something in the weeks pay.

Incidentally, it is correct they take the hourly rate off you if you were sick.

It's probably the easies way to do it, otherwise you need to take some off the weeks you don't work since thats when the extra gets paid.

badlespoon

That's great guys thanks......

I had again already thought of the whole year to year part, as again we have earned that money already so we are entitled to it.
Will check all those links out, so many many thanks for them.


Incidentally, it is correct they take the hourly rate off you if you were sick.

I know that that is the correct way of doing it but if they want to treat us as being on a hourly rate in one sense, then they can pay redundancy at an hourly rate...... they can't have it all ways, was my figuring!

Many thanks again for all your help guys.

B x

Orville

I know it's good you are trying to help your unlucky co-workers, but do be aware that if management get wind of your background dealings with a redundancy you have nothing to do with, you could very well find yourself top of the list next time round.