ACCA F4 - Corp and Business Law (ENG)

152 9: Dismissal and redundancy  Part C Employment law

8.3.1 Misconduct of the employee

An employee who is dismissed for misconduct is not entitled to redundancy pay even though they may

become redundant.

Sanders v Neale 1974

The facts: In the course of a dispute employees refused to work normally. The employer dismissed them

and closed down his business. The employees claimed redundancy pay.

Decision: The claim must be dismissed since the employees had repudiated the contract before the

employer's decision to close down made them redundant.

An employee can be dismissed for misconduct but still claim redundancy pay in the event of a strike.

 After receiving notice of termination of the contract from the employer

 After the employee has given notice claiming redundancy pay on account of lay-off or short time

8.3.2 Offer of further employment

The employer may offer a redundant employee alternative employment for the future. If the employee then

unreasonably refuses the offer, they lose their entitlement to redundancy pay.

The offer must be of alternative employment in the same capacity, at the same place and on the same

terms and conditions as the previous employment. It should not be perceived as being lower in status.

When there is a difference between the terms and conditions of a new contract and the previous contract,

the employee is entitled to a four week trial period in the new employment. If either party terminates the

new contract during the trial period, it is treated as a case of dismissal for redundancy at the expiry date of

the previous employment. The employee can also still bring claims for unfair dismissal.

8.4 Lay-off and short time

An employee's exact remuneration may depend on the employer providing work. They are 'laid off' in any

week in which they earn nothing by reason of lack of work or they are 'kept on short time', which is any

week in which they earn less than half a normal week's pay.

When an employee is laid off or kept on short time for four or more consecutive weeks, or six weeks in a

period of thirteen weeks they may claim redundancy pay by giving notice to the employer of their

intention to claim.

In addition to their notice of claim the employee must also give notice to the employer to terminate the

contract of employment.

8.5 Strike action

Employees involved in strike action after redundancy notice is served will be entitled to redundancy

payments. However, if they are on strike when the notice is served they will not be eligible for the

payment.