Questions about redundancy

YorkshireBoy

Squiffy wrote:

Yorkshireboy - it seems you are right. :beer: I've spoken to my union (at last!) and they have confirmed that as long as I'm not taking gardening leave, the notice pay can be taken within my redundancy.

The company have to agree to this, but bearing in mind that if it is taxed they will have to pay employers NIC on it, they should be quite amenable.

Great news!

And thanks for the useful links you gave. I'll use them tomorrow if I do need to negotiate on this point.

You're very welcome. I had another job lined up *BEFORE* I'd even cashed my redundancy cheque! - and with a salary increase as well. I genuinely wish you all the luck that I had two years ago following my own redundancy (after 26 years with the same firm!).

Good luck!

Jacster_2

Hate to throw a spanner in the works, but....

Within the past 2 years the Inland Revenue have really focussed on PILON (pay in lieu of notice) as they realised they were losing a fortune through it being paid tax free.

If an employer chooses to pay PILON tax free and then gets audited, they will be asked to make it good by the IR.

Due to this, not an option any employer likely to take at the moment....

The only alternative would be for an employer to pay you your notice 'tax free' and 'gross it up' to the IR. ie - tax is still being paid but by the company, not you. Some serious bargaining by the union required for this.....

I know it's not what you wanted to hear, but it's something new I came across at work within the last 6 months....

Squiffy

Well, my employer has agreed to do it. If the IR do come in the future and want the tax on it, can they chase me for it or will it be down to my ex employer?

Jacster_2

Squiffy wrote:

Well, my employer has agreed to do it. If the IR do come in the future and want the tax on it, can they chase me for it or will it be down to my ex employer?

Check it out. Get it in writing if they employer says they've covered it. Otherwise you will be liable, I think.

Squiffy

OK, got my letter today outlining PILON & redundancy amounts (totally gobsmacked and delighted at the amounts! :j ). It also confirms my leaving date as next Thursday.

Is that it? Are they legally bound to honour this now?

I've been treading on eggshells recently so as not to put my PILON at risk, but now it is in black & white am I home and dry?

Squiffy

Does anyone know whether the letter of notice is legally binding?

I just want some reassurance that they can't change their minds on the date and the PILON payment.

Jacster_2

Squiffy wrote:

Does anyone know whether the letter of notice is legally binding?

I just want some reassurance that they can't change their minds on the date and the PILON payment.

It should be, but it depends on what they've written in the letter.

If there is a 'without prejudice' I would worry. If not, and it is a formal notice letter, you should be OK, but I'm not 100%....

HTH, and good luck!