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Can I re-employ someone I made redundant?

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If you have made an employee redundant, but then your business’s economic situation improves and you need to recruit, you can re-hire the redundant employee. You are under no obligation to wait a certain period of time before offering the job to the redundant employee. Similarly, if their previous role does become available once more, you are not obliged to offer the role to them; you can recruit someone else, as long as the original dismissal for reason of redundancy followed a fair procedure and there must have been a genuine reason for the redundancy.

Here, our Employment Law team explains the rules behind rehiring an employee you’ve previously made redundant as well as other considerations you need to make regarding the redundancy process. 

When can I make an employee redundant?

There are several situations where an employee’s role can become redundant:

  • their role no longer exists,
  •  there will be less work or demand for them,
  •  the workplace has closed.

If you do make redundancies and then look to re-hire for the same role at a later date, the employee who was made redundant could potentially bring an unfair dismissal claim against you if the redundancy was not carried out correctly. If this occurs, the Employment Tribunal will look at the time from when the redundancy consultation period started to until the employee’s contract was terminated. If you hire someone else shortly after the employee was made redundant, the legitimacy of the dismissal might be doubted if it is challenged in an unfair dismissal claim. You would need to show that there was an existing redundancy situation when the employee was dismissed and it was only after the dismissal that the business’s economic position changed.

How can I re-hire an employee I made redundant?

If you wish to re-hire the redundant employee, but want to make sure that their continuity of employment is broken, there should be at least a clear calendar week (which starts on a Sunday) between the termination of one period of employment and the start of a new period.

This would normally break the continuity of employment, unless there is an agreement between you and the employee to preserve the continuity.  It needs to be made clear in the contract that this is a new period of employment and that previous employment does not count towards this new period. To err on the side of caution, a minimum two-week break in service is advisable.

However, if the offer of the new position is made before the original employment has ended by redundancy, for example the employee is notified about the redundancy but before the employment ends you offer them a new job, the continuity of employment will be preserved if the job starts within the 4 weeks after the redundancy date.

How does re-hiring a redundant employee impact any redundancy pay?

For the purpose of the statutory redundancy payment, continuity of service is broken when a redundancy payment has been made to the employee, and the employee is then re-engaged under a new contract of employment. This means the employee’s service will not be counted twice for the statutory redundancy payment. So, if the employee is made redundant again in the future, they will not be entitled to a statutory redundancy payment until they have accrued another two years' service and the statutory redundancy pay calculation will be based on the latter period of service only.

Making redundancies is not something that should be taken lightly and should always be done after seeking legal advice. Our Employment team can advise you as to your responsibilities regarding your employees, and will ensure you follow a fair procedure to minimise the risk of potential claims against you. To find out more about how we can assist you, call us today on 023 8071 7717 or email employment@warnergoodman.co.uk. You may also be interested in the following articles:

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.