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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 47410
Experience:  Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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We currently employ 10 full time members of the team

Resolved Question:

Hi
We currently employ 10 full time members of the team and are considering a complete restructure of the business which would see their roles going from employed to self employed. Financially this would benefit the employee as they will go from earning circa £30k to £39k per year therefore we feel most would like this solution. From a legal stand point how would we address this should we decide to go this route.
Thanks
Alina
Submitted: 1 year ago.
Category: Employment Law
Expert:  Ben Jones replied 1 year ago.
Hello, my name is***** am a solicitor on this site and it is my pleasure to assist you with your question today.firstly can you tell me how long these members of staff have been employed by you and are you considering offering redundancy payments please.
Customer: replied 1 year ago.

Hi Ben

They have been employed for between 1 - 30 months. 4 members of staff have been employed for more than 12 months, the remaining 7 have been less than 12 months.

Ideally we would like to avoid paying redundancy as the employee will actually be financially better off with the new structure.

Expert:  Ben Jones replied 1 year ago.
Thank you for your response. I will review the relevant information and will get back to you as soon as possible. Please do not respond to this message as it will just push your question to the back of the queue and you may experience unnecessary delays.
Expert:  Ben Jones replied 1 year ago.
Many thanks for your patience. Due to the various lengths of service of the affected employees, they will all have different rights. I will therefore split the group into two and discuss your options for each one.
The first group is those employees which would have less than 2 years’ service at the time their employment terminates. These would be the easier ones to deal with because until an employee has 2 years’ service they are not protected against unfair dismissal and also are not entitled to any redundancy pay. So you could dismiss them for more or less any reason and without having to justify your decision. In your case you would simply be required to issue them with their respective contractual notice periods and terminate their employment as employees. You could then re-engage them on the new contracts as self employed. They would not be due any redundancy pay.
The second group is those employees who would have more than 2 years’ service at the time their employment terminates. They will be protected against unfair dismissal so you have to justify why you are terminating their employment and follow a fair procedure. Using the reasons you have suggested will mean they are going to be made redundant because you are reducing the need for employees to carry out their specific roles and that is a redundancy. You need to take them through a formal redundancy process, place them at risk of redundancy, invite them to attend consultation meetings to discuss the proposed plans and offer them suitable alternative employment, which in this case would be the self employed positions you have in mind. As they will be terminating their employment as employees, even if they are remaining in a self employed position and earning more, they are still being made redundant and would be due redundancy pay. However, as they only represent the minority, your liability for redundancy pay would not be too large, considering the majority of affected employees are not due redundancy anyway due to having been there for less than 2 years.
I trust this has answered your query. I would be grateful if you could please take a second to leave a positive rating (selecting 3, 4 or 5 starts at the top of the page). If for any reason you are unhappy with my response or if you need me to clarify anything before you go - please get back to me on here and I will assist further as best as I can. Thank you
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