The coronavirus pandemic is affecting all of our lives. The current economic climate is leading to many company failures and resulting redundancies.

I always find redundancies the hardest as often the individual who is losing their livelihood has done nothing wrong. Hopefully, the employer has followed the correct procedure in getting to the redundancy decision and has also calculated the redundancy payment correctly. There are some errors which can be easily made with regard to redundancy payments and are easily rectified:

• The redundancy payment is not simply a week’s redundancy pay for each year of service. The calculation requires the age of the employee from their start date to their finish date. Payment is 0.5 weeks for years employed under the age of 21, 1 week for every year between 22-40 years of age and 1.5 weeks for every year aged 41 or over.
• The maximum number of years of employment that is taken into account is 20, but for the calculation the most recent year is taken, and it then is worked backwards.
• Statutory redundancy payments are subject to an upper limit, and it is currently £538 per week. The amount is set by the Government and based on the Retail Prices Index. If an employee earns more than this amount per week, this higher amount is not taken into account in the statutory calculation.
• Calculations are based on the number of complete years’ service and are based on the start date and termination date. It is not based on calendar or tax year.

We all know the consequences, both monetary and mentally of making HR mistakes, so now is the time to getting some external support. Contact Paul at Coppice HR (paul@coppicehr.com or 07814 008478) to take the strain out of HR in your organisation. It may even let you concentrate on other aspects of post-COVID-19 business, such as sales!