HR & Employment · 27 March 2021

Can you work for the same company after a redundancy payout?

Can you work for the same company after a redundancy payout?

Redundancy and all things related to it are, unfortunately, hot topics around the globe, with a lot of economies lurching forward through the pandemic. Redundancies do need to be done correctly from an ethical and legal perspective which we cover in our article How to make someone redundant.

Your redundancy would have occurred for one of three reasons:

  1. a) As a result of a business closure or closure of the section of the business. For example, a business is no longer doing their deliveries themselves, or
  2. b) The business is moving to another location which is too far away or in another country. For example, manufacturing is moving to India, or
  3. c) The business needs to reduce expenses radically, and headcount has had to form part of that.

Can you apply for a job with the same company after being made redundant?

If the company you worked for initiated and executed a redundancy process due to economic reasons, like Covid19, they might have survived due to their economic austerity. This is fantastic news, and if they are receiving a renewed abundance of orders, they will soon be able to hire or re-hire.

There is no restriction on companies with regards to re-employing someone they have made redundant. They absolutely can re-hire you. They will need to be careful how they go about it to avoid legal claims being submitted with accusations of unfair dismissal by other employees who were made redundant at the same time as you. Do not be surprised if this does occur, as some employees may experience bitterness when they see your fortunes changing.

Because the risk of this occurring is quite high, it will mean that the process may not be as simple as you wish it to be.

The company will need to be prepared for this and, therefore, have hopefully been very fastidious in collating records during the redundancy process, proving that the redundancy was genuine. This comprehensive and full set of records will need to show the redundancy’s economic necessity at the time that it occurred.

A complementary set of documents should be collated when the company recommences recruiting to show that this is now happening due to a change in the company’s financial situation.

How long after redundancy can I work for the same company?

The company that made you redundant might not automatically rehire staff when the orders start flowing again. They might debate the pros and cons between hiring and training new employees versus re-employing the individuals that already have the training and knowledge of their business, the relevant skills, the knowledge of the company culture etc.

The company has done well if, after being made redundant, you are still willing to consider going back to work for them. This means they have treated you well throughout the redundancy process. This bodes well for your future career with them.

Some companies believe that if they are re-hiring you very quickly or even immediately, then it is a continuity of employment. Based on this assumption, they then might request for the return of any statutory redundancy payment that was made to you by them during the redundancy process.

This is incorrect in the eyes of the law as an employee who is re-employed after being made redundant can retain their statutory redundancy payment without any repercussions or clawback opportunity. This stands true whether or not they are immediately re-employed or return to work for the same employer at a much later date.

Under s.214 of the Employment Rights Act 1996, the fact that money has been paid AND been received under the title of Redundancy Payment then an immediate break occurs in the employee’s continuity of employment for the purposes of the statutory redundancy pay scheme. There is a general favouring in the market, however, of allowing for a one week break to show a true intent of breaking the continuity of employment.


 
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