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Redundancy payments with maternity rights

Redundancy payments with maternity rights

A member of staff has just returned from additonal Maternity Leave. We are currently in a 90 day consultation period.

If she were to be made redundant how is a week's pay calculated, ie she was on no pay for the last 6 months due to AML and came back part-time temporarily. She previously worked full-time.

Any help gratefully received!
Wendy Acton

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23rd Jun 2006 10:05

Hi Wendy,

I don't think that the fact that she was on unpaid AML affects the calculation of a weeks pay. If her normal working hours are part time hours at the calculation date (i.e the date she is given notice of redundancy)then ' a weeks pay' would be based on her p/t earnings. This could be different if the p/t working was just an interim arrangement and it was recognised that her normal (contractual) working hours remained full time, in which case a weeks pay would be based on her full time earnings.

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By Anonymous
23rd Jun 2006 12:22

Would still suggest that she could argue that Management were aware of the possibility of redundancy when it agreed to her part time working.

If the sum involved is quite small I would suggest that you treat her as full time but tell her she is being treated as full time in view of the short time she has been part time.

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By Anonymous
23rd Jun 2006 11:25

Sorry to disagreement but she may have strong grounds to claim the redundancy pay of a full time employee.

What you don't make clear is the timescale between the agreement for parttime and teh redundancy period.

If I was her I would be arguing that that I was allowed her to go part-time to save part of the redundancy payment and you were aware of the prospect of redundancy when you allowed me to go part time. This argument may well stand up should she take it to a tribunal.

Sorry but you must now a days look at the worst case situation and think what would have if they took it to a tribunal.

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23rd Jun 2006 11:42

The lady in question has been back 4 weeks part-time at her request. The consultation started at the beginning of this month for 90 days.

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By Anonymous
26th Jun 2006 17:03

My comment is based on the fact that she may have strong grounds to claim that the company was aware of the possibility of redundancy when they agreed to her moving to part time hours and their action in accepting the reduction in hours was to reduce the possible redundancy payment.

In this case and any other similar situations I would stand by my original comment as you are not "opening the gates to all other employees who have changed their hours over the last few years". This is a specific response to a specific situation and is to stop a possible claim which will cost the company money & time in defending the claim and could damage their reputation as it involves a mother returning to work.

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By Anonymous
26th Jun 2006 12:39

I wonder if we are missing the point here.

If the employee is aware that their payment will be based on the hours that they work when they leave then it is their decision whether to work full time or part time.

Give her the facts and allow her to make her choice.

However this is not a case of allowing the employee to chop and change their hours when they want (like just before their leave date). Redundancy needs to be managed and it is perfectly fair to ask her to make her decision now.

I disagree with Iain’s point because if you allow her to have full time payment rather than part time then you are opening the gates to all other employees who have changed their hours over the last few years – where do you stop?

There is no requirement in law to pro-rata due to previous full time service.

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27th Jun 2006 17:25

The answer really depends on the timing of the dismissal and whether you pay statutory redundancy pay only or you have a more generous scheme.

Statutory redundancy pay is calculated on the employees's weekly salary at the time of redundancy dismissal, subject to the (statutory) maximum amount, unless approaching retirement age or made redundant while off sick, laid off or on short time working.
Where an employee works full time, changes to part-time and is then made redundant, statutory redundancy pay would be calculated on the (reduced) part-time weekly salary.

Where earnings vary each week, an average of earnings over the twelve-week period leading up to the dismissal should be used.

Some employers that pay more than SRP will calculate the contractual payment pro-rata according to the proportion of service worked full-time c/w part-time.

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