How long after making someone redundant can you replace them?

There are many reasons to make someone redundant. New technologies might have reduced the need for manned operations, the job might have been completed or evolved into something else over time, or there simply isn’t enough in the budget to keep the same number of staff. As harsh as it might sound, redundancies are a normal part of business. If you are asking how long after making someone redundant can you replace them, there is no legal waiting period, and you can advertise the role immediately if the redundancy was genuine and the correct process was followed.

Difficulties can arise, however, if you want to hire someone into your business shortly after making someone redundant, especially if the new role you are filling looks the same or similar to the one you made redundant. For business owners, managers, and employers, the issue is not the passage of time but whether the original redundancy was real and whether the new role is materially different. Replacing a person or role immediately suggests that the person or the role itself were not redundant to begin with.

Redundancy refers to something that is no longer necessary or useful. If you make an employee redundant and immediately replace that person, and the job role looks very much like the same role, then you could face claims of unfair dismissal. The government website clearly states that “for a redundancy to be genuine, you must demonstrate that the employee’s job will no longer exist”.

The good news is that there are ways to use redundancy to help your business while still making sure every role is filled and your business can run smoothly. In business restructuring, roles do change and although someone might feel replaced, there is often a clear need for a different person if the role has changed. This guide explains the rules on making redundancies, replacing redundant employees, when you can rehire after redundancy, the risk of unfair dismissal claims, and how to restructure roles lawfully so you can protect the business and stay compliant.

Can you make someone redundant and then replace them?

Although you cannot make someone redundant and then replace them with someone fulfilling the exact same role, you may be able to replace them in a similar position where there is a genuine redundancy and the new role is materially different. The contract must look different, and significant changes to the job description can help defend legal challenges; there must also be discernible and reasonable changes that require the redundancy process and refilling of the position. This could include:

• Filling a new role with someone less skilled and on lower pay, for example, if you want to offer the position as an apprenticeship
• A new role with a different title that requires more experience or training (this is more common in restructuring)
• A role that is similar but has additional requirements

 

Employers should keep clear records of the business rationale and the changed business need behind cutting the role.

Something you must bear in mind is that, as part of a fair redundancy process, if the job description for the new job is close to the current job, you are legally required to offer the position to the person you currently employ. This helps show a fair process and that the redundancy is genuine, which helps avoid unfair dismissal claims.

It is your responsibility as an employer to try and ensure your employee’s retention. You may even find that your employee has done additional training or added to their CV without you knowing it while they were working for you. Failure to offer an employee the chance to apply for a similar position can result in an unfair dismissal charge and legal fees you could have avoided.

Our top advice: don’t refer to someone as being “replaced”. This automatically suggests that their role was filled by someone doing the same thing.

How long before you can replace a redundant position?

If you do find yourself in a position to hire someone after making someone redundant, there is no fixed legally mandated time frame in the UK. In employment law, an employer can rehire without a waiting period, but only if the earlier dismissal was a genuine case where a redundancy situation exists.

You could start advertising immediately provided you have followed all the proper channels for making your redundancy decisions. Hiring into the redundant role very soon after the termination date can cast doubt on whether the redundancy was genuine.

Care should always be taken when rehiring to make sure you mitigate the risk of unfair dismissal allegations. It is not uncommon for disgruntled previous employees to seek revenge and take their employers to court.

There is a time limit of three months after termination for an unfair dismissal claim to be made to an Employment Tribunal, so many businesses often wait until this window has passed before filling any new positions. Many advisors also suggest waiting at least 3 to 6 months before refilling a role to reduce the appearance that the original redundancy dismissal was not genuine.

If you start advertising for a position that looks the same, you will need to be able to adequately defend the reasons for making someone redundant and then advertising the same job. If you can’t provide a defence then you could face legal action.

When you make someone redundant, be sure to work carefully to make sure you are covered if you do need to hire a similar role. If you face any unfair dismissal claims, you will need to show:

• That the redundancy was genuine and objective under the Employment Rights Act 1996, and that it was a genuine redundancy situation. This is to protect people from being pushed out of jobs for personal reasons
• The redundancy was unavoidable
• The ways the financial position of the business have changed to cause you to make the redundancy and then recruit new workers so quickly afterwards.

 

An exception can be made if you receive a new contract or grant that brings in a renewed need for a position you recently made redundant. Alternatively, if the contract or grant gives your business enough money to reinstate a position. Bear in mind that the employer’s decision will need evidence that the earlier redundancy situation existed at the time and that the new business was either unexpected or uncertain enough to warrant redundancies in the first place.

Do I have to offer a new position to a redundant employee?

Once a person is made redundant, there is absolutely no requirement for a business to hire them back – even into a similar role. Even if your financial position suddenly changes and the exact same role becomes available, there is no legal obligation to re-hire the person who previously filled the role.

There are pros and cons to getting in new staff so you should think carefully about how you might keep on good staff. There is also an employer’s obligation until the last day of employment to keep looking for suitable alternative employment within your organisation for anyone facing redundancy. If an employer offers an alternative job before the dismissal takes effect, the employee may be entitled to a four-week trial period. Employees with two years continuous service are also entitled to paid time off to look for work or arrange training.

If you re-hire redundant staff within a week of their last day of work then their “continuity of employment” is not impacted. If their employment contract ends and you want continuity to break so a new contract starts instead, you will need to wait at least two weeks between their last day of work and new start date.

If you would prefer a new hire, or if you find someone better suited to the new role, then you should offer them the job. There is no need to limit yourself to an employee who was made redundant.

Eligible employees may also be due a statutory redundancy payment, with redundancy pay to be received for each full year worked for the employers. How much you get depends on how old you were during each year.

Typically you would be entitled to the following:

• half a week’s pay for each year you were aged under 22
• 1 week’s pay for each year you were aged 22 to 40
• 1.5 weeks’ pay for each year you were aged 41 or older

The enhanced redundancy payment rates would only apply for the full years you were in the higher age bracket.