Redundancy Stunts

“Tribunal awards are generally low anyway.    Its the fact that it willl cost the employer to go to tribunal that is the leverage.”

“Settlement agreements ate only neededif the redundancy has not been fair.”

TJ’s advice on this thread has been absolutely terrible, and that third sentence is just untrue.

Rejecting a negotiated redundancy package, “waiting for the cockup”, threatening to take them to a tribunal, and then smugly waiting for a better offer is crazy.

The alternative to a negotiated package is the statutory minimum (or the contractual provision, if there is one – unlikely) which is not generous. There’s no getting a negotiated package without signing an agreement – the employer isn’t going to give you anything without a promise that you’re not going to try to double dip by suing them. The employer’s interest in negotiating a package is to hurry everything up and just move on (and maybe even to be fair sometimes).

If you reject a package because “there’s bound to have been a cockup”, then you could find yourself in a prolonged and stressful legal dispute to get…the statutory minimum. Even if the tribunal finds the redundancy process was totally butchered, as someone wise once pointed out, tribunal awards are generally low anyway. 🍾

TJ worked in the NHS which is clearly very different form the private sector. Even when the private sector cock up they don’t often back down and an employment tribunal is expensive, stressful and doesn’t result in high payouts.

I’ve had a number of compromise agreements, some mutual when they were a way of enhancing redundancy by reducing tax, that loophole is closed. Last one was due to my employer summarily dismissing me because I collapsed at work due to work related stress and was carted off in an ambulance. I went to see an employment solicitor who was quite blunt about the benefits of a tribunal. Walked away with the max tax free pay out in the end because they just wanted it closed. If I had dug my heels in further I don’t think I would have got a better deal.

Made this point earlier today but may have been missed as it was part of a long and detailed post.

There’s no such thing as a compromise agreement nowadays, it was replaced by settlement agreement some years ago including some changes in the law, particularly around tax.

I make the point not to be snippy, the terms are often used interchangeably, but just be cautious if reading websites talking about compromise agreements the info may be out of date. The internet is a wonderful thing but it has shit version control.

I’m going to have to be intentionally vague here, but this happened to me at the end of last year. I work / worked in tech stuff. The company cut about 10% of headcount twice in the course of the year, and I got lucky on the second occasion. Think low triple figures in terms of people going.

What I’m going to write is based on my own experience. I strongly suggest you take advantage of the solicitor payment thing to get frank advice from them on what is achievable. I got this from mine before the actual offer was made as part of the initial consultation. You should also use the links people have shared above and ACAS, and, if you have it (sounds like you don’t) a Union rep.

A Compromise Agreement in this context is basically intended to dispose of headcount as efficiently as possible. As a result, the settlement agreement is priced around about what your lawyer might suggest is around the rate of a successful claim for constructive or unfair dismissal, unless you have specific grounds. Obviously, if you choose to go down that route then it’s often more stressful and prolonged than taking the offer.

The reason the company will pay for your solicitor is so there is no comeback that you were hoodwinked into a settlement.

I would use your time now to work out what extra bells and whistles you may be able to ask for. My offer was PILON plus a settlement amount tax free. I worked mostly from home post-pandemic, so had a nice office chair that I got to keep. Everyone got to keep their company smartphones. My C2W loan was written off and I kept the bike I’d bought in August through the scheme for a tiny fraction of its value.

Last bit of advice: heed Charlie’s First Law. I ultimately went freelance and am now back doing work for my former employer and also working for a lot of former co-workers who were laid off and then got new jobs very promptly after.

Politecameraactuon

Fortunately thats not what i said.

I included “get proper advice”

I akso workedin the private sector and Mrs Tj did a lot of this stuff   i have personally been thru the process and got 20x my entitlement from a private sector company

I did not say reject a decent agreement

I said do not agree on the spot.  Get proper advice

I was really surprised when the US company I worked for offered a huge chunk more than our already chunky UK based redundancy package in 2021.
With 31 years’ service they basically paid me 5 years wages and my pension as though I had worked to 60!!

Given I was looking for a way out it was a gift from the gods, oh and they keep asking me to do consultancy work for them (not a bloody chance as I am stress free now)
If the numbers add up and you can find other work if you need don’t sweat it 😀

The reason the company will pay for your solicitor is so there is no comeback that you were hoodwinked into a settlement.

Hmmm. As per some poster on the previous page, the company will pay because that’s what the law says they have so do

the company will pay because that’s what the law says they have so do

That’s incorrect.

The law says you have to have qualified advice (IIRC doesn’t have to be a solicitor specifically, just has to be qualified to give it)

It doesn’t say the employer has to pay, but it’s pretty standard because unless the employee gets the advice then the SA is not valid and they can still then go to tribunal.

If its a US company then expect it to be absolute minimum

FWIW the UK company that made me redundant did the absolute minimum (actually less than), and grumbled about having to do even that. Had to go through the tribunal process to get something fairer, and they fought me (with some pretty dirty tactics) every step of the way.

i have personally been thru the process and got 20x my entitlement from a private sector company

You do realise that in disclosing that you’ve broken the terms of your agreement and now have to pay that back 😉

I thought a compromise agreement was used to get rid of people who were underperforming but not badly enough that they could be safely dismissed. So through the CA they were paid to go away. A settlement agreement is used during a wider redundancy process to ensure that you don’t come back and claim unfair dismissal, and usually involves payments that are larger than statutory minimum.

And I’m another one who got a generous payout from a US company. They could have paid me nothing at all, but my final payslip made for an enjoyable read.

Nope, they’re the same thing but not – one superseded the other in name and details and there’s no such thing as a CA now, as explained above. In the situation you describe above, you could use a SA to achieve that.

And as per earlier post and the links therein, a SA is different to a redundancy payment and PILON but the three often go together and happen at the same time. But are different in their tax treatment.

No non disclosure agreement jonv.

Me and mrs tj ran rings round them😜

Is it legal for a company to offer something that’s only available if you accept it in the initial meeting or that same day? To pressure you into accepting it out of fear of getting even less.

if they are offering anything over statutory then it’s entirely discretionary and they can withdraw or reduce that at any point before you sign up.

You weren’t answering my question, but it seems applicable and it sounds like yes.

if they are offering anything over statutory then it’s entirely discretionary and they can withdraw or reduce that at any point before you sign up.

I don’t totally agree; IANAL but ACAS doc pp26/27 covers this. Having made the offer then applying time pressure on people to take it or we’re going to then withdraw it and offer less or nothing at all could be considered ‘improper behaviour’ which is then good cause for a tribunal. For sure there are material circumstances that can allow an offer to be withdrawn and a reasonable timescale can be enforced (ACAS say 10 days) but ‘one time offer, you have to say yes now’ would not be acceptable. As I said before, if they do that / keep doing that let them, write it down each time, and then use it back against them

I’d submit that much as I respect TJ’s personal experience as an employee and a union rep he has limited experience of ‘companies’ and in fact most DON’T muck it up.

+1

I’ve been laid off 5 times, with my current employer going to be doing it later this year / early next – so I’ve seen many versions over the years.

Key thing is how senior you are, how long your notice period is and how ‘driven’ the company are in making the changes in how ‘flexible’ & generous their offer will be.

If you’ve been with them 10 years it all depends on whether you need to be working at the end or not as to what you should do – question I always ask colleagues when they ask for advice is “do you need to work somewhere this time next year?”

If you do then your #1 focus should be in finding a new job, NOW.  Payoff’s can disappear quickly when you’re not working.

Otherwise, sit and wait.

Oh, and getting legal advice – the last time I was laid off this was offered, I split the difference with them and took it added to my pay-off.  I already knew what they’d paid me was far, far in excess of what they had to pay me – so saw it as a risk rather than a benefit.

Not sure I agree with Chew. My compromise agreement from a US company was 2 weeks salary for every year of service plus £30k plus 3 months notice. And as above the company paid for a solicitor to rubber stamp the agreement. Hope you get a good offer.

I’ve seen the same US employer try every single way possible when dealing with UK and EU staff.

From “overly generous” (some guys walked away with 3-4-5 years salary and a pension uplift) then to “slightly generous”, “OK, that’ll do” then “statutory minimum” and finishing up with “WTF were you thinking” and tens of millions of retrospective payouts and fines. Several on the US HR side even got fired.

Completely irrelevant to the OP but quite amusing…

https://www.mirror.co.uk/news/uk-news/thwaites-brewery-sign-lights-changed-3059037

In my experience if you don’t get made redundant and are ‘moved’ (can’t remember the legal term) to the new off shore company (tata by any chance) you will just get made redundant in a years time with sweet fa.