Q How do we lay people off or put J them on short time work? We are going through financial problems and the business needs to cut costs and we do not want to lose the employees for good?
A Laying-off an employee basically means temporarily not providing him or her with work. Short-time working is where work provided is less than half that the employee is entitled to under the contract of employment.
While layoffs or short-time working may appear an attractive option where the business needs to cut costs there are a number of legal problems to consider.
An employer must have contractual authority to withhold remuneration in the event of no work or a reduced demand for work - or laying off an employee or putting them on short-time work is likely to amount to fundamental breach of contract. This could lead to claims for unlawful deductions from wages or constructive dismissal.
Secondly, even where there is the contractual authority to lay off or put on short time there is a statutory scheme under which an employee can claim a redundancy payment. This arises where the layoff or short time working is for four or more consecutive weeks or a total of six weeks in a total period of 13 weeks. The employee simply has to give notice to the employer that he or she is requesting their redundancy payment.
Therefore if you wish to avoid losing the employees you should be aware that any period of lay off or short time work should be relatively short.
You should look at the contractual provisions and provide the employees with as much notice as possible. Whilst the express right to lay off may exist you will be expected to act reasonably. o Kerstie Skeaping, Halliwells LLP Solicitors, 100 Old Hall Street, Liverpool L3 9TD. Ring 0870 365 9842, fax 0870 365 8004 or e-mail Kerstie.Skeaping@halliwells.com
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|Publication:||Daily Post (Liverpool, England)|
|Date:||Dec 17, 2008|
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