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Ben Jones
Ben Jones, UK Lawyer
Category: Law
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Experience:  Qualified Solicitor - Please start your question with 'For Ben Jones'
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My husband was made redundant in September 2013 due to the

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My husband was made redundant in September 2013 due to the company losing a major client. We had an expensive holiday booked and we cancelled it and got the money back via our insurance. He hadn't received any redundancy pay to that point just notice. He was then offered another role at the same company with a big loss in salary. He took it. Now the same situation is happening to me. The company I work for has gone into liquidation and we had to cancel another holiday. The insurance company are being difficult and I suspect are looking not to pay based on my husbands situation. Was he still technically redundant as his position no longer existed before he chose to take a lesser much less well paid position?
Submitted: 1 year ago.
Category: Law
Expert:  Ben Jones replied 1 year ago.
Hello, my name is ***** ***** it is my pleasure to assist you with your question today. Did he take up the alternative role before his employment had terminated?
Customer: replied 1 year ago.

Thanks Ben. What constitutes termination?

Customer: replied 1 year ago.

Fundamentally what I am looking to do is make sure that the insurance company does not try to prevent paying out on my current situation through a technicality on my husbands

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. Thank you
Expert:  Ben Jones replied 1 year ago.
Many thanks for your patience. Termination is when someone’s employment is actually terminated. That does not mean that they simply change jobs within the company – they must actually cease to be employed by their employer. Had the employer gone through with the redundancy and not offered him another job then he would have eventually been made redundant and his employment terminated. However, if he decided to take another job, even if completely different to his existing one, then there would be no termination as he would continue to be an employee of the company.
This means that if the insurance policy specifically stated that they would only pay out on termination of someone’s employment, they should not have paid out in your husband’s case as his employment was never terminated. Had the terms said that the cover applies if his job had fundamentally changed then that is a different matter and could have covered his situation. However, if they explicitly referred only to termination then it would not apply to him as he was not terminated – he continued to work with the same employer, albeit in a different position.
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
Customer: replied 1 year ago.

Hi Again Ben

Sorry I have two clarification points

1. if he was terminated would that mean there would be no continuity of employment?

2. The actual definition of redundancy in the booklet is any person declared redundant who has been employed for two continuous years with the same employer.

His initial position became redundant. There is no mention of the word termination. In that case where do we stand?

Thanks again

Fiona

Expert:  Ben Jones replied 1 year ago.
Hi, if he was terminated then his employment would terminate and break his continuity of service with the company. That is unless there was less than a week's break between his employment ending and him starting a new job, in which case the continuity would not be broken. If there is no mention of the word termination then your position would not necessarily be better. They only mention someone being declared redundant - that does not automatically mean termination, although under law generally a redundancy means that your employment is terminated. So it is down to interpretation really - they would argue that redundancy must mean he was terminated because to be made redundant means to be dismissed because of redundancy and as there was no dismissal here then strictly speaking there was no redundancy. In this case he was not made redundant, he was offered alternative employment and remained employed by them so technically he was not 'declared redundant' so to speak. Just to make a point - if you cannot agree on this you still have the right to complain to the Ombudsman for free - they will review this independently and issue a binding decision. So if they agree with you, the insurer could be forced to pay anyway. If your original question has been answered I would be grateful if you could please quickly rate my answer by selecting 3, 4 or 5 starts at the top of the page - it only takes a second to do and is an important part of our process. I can still answer follow up questions afterwards if needed. Thank you
Customer: replied 1 year ago.

Thanks again Ben

I just read somewhere that if an employee is made redundant and is due to start another job with the same employer then continuity of employment will be preserved so long as they start their new job within four weeks of the effective date of termination of the previous employment contract - is that incorrect?

Thanks again

Fiona

Expert:  Ben Jones replied 1 year ago.
This only applies to local government positions it is not a general rule
Customer: replied 1 year ago.

So the fact that Ian's position terminated and he had a new position with the same company within 1 week of termination means that he was still technically redundant. The company was unable to pay redundancy pay at that point is that an issue?

Expert:  Ben Jones replied 1 year ago.
No he was not made redundant and as a result he also did not receive a redundancy payment. He would have been made redundant had he allowed the employer to terminate his employment by refusing to take up the alternative position offered
Customer: replied 1 year ago.

But his position was terminated.

Customer: replied 1 year ago.

By way of absolute final clarification

In mid August 13 he was told that he would be made redundant with immediate effect as the company had lost a major client. He was also told that due to the fact the client went with immediate effect the company could not afford to pay redundancy at that point or payment in lieu of notice (it was a family members business).

Within a few days he was told that if he accepted another position he would be paid as the company could afford it. The company was not in a position to offer him any payments after that. He did not receive any funds from the new position from that point on.

He continued because of the family connection and was fortunately in a position to do this.

What is the position?

Expert:  Ben Jones replied 1 year ago.
Based on this information he would not have been made redundant. He was initially at risk of redundancy, where his job had disappeared and they were looking at making him redundant. At the same time they would have had a duty to try and offer him other suitable employment. They made him an offer but whilst not suitable, he decided to accept it. There was no break in service and his employment was continuous. He therefore avoided redundancy by deciding to remain employed by them. Had he rejected the offer of alternative employment and allowed the employer to terminate his employment that is when he would have been made redundant and had his employment terminated. Hope this clarifies?
Customer: replied 1 year ago.

Ben thank you so much. I realise its my bad explanations. It should have read within a few days of him already being terminated he accepted the new offer.

So sorry to keep this going.

Thanks again for all of your help.

Fiona

Expert:  Ben Jones replied 1 year ago.
No problem at all, I am here to try and help you resolve this. So as mentioned earlier the key is how long after he left his original job he took up the new employment on offer. I must apologise and correct myself with the advice I gave you early about the four weeks only being applicable to local Government positions. That is correct but it is not just limited to that, I just remembered the specific section in law that deals with this.
In the context of re-employment after redundancy, section 138(1)(a) of the Employment Rights Act states that, "where an employee's contract of employment is renewed, or he is re-engaged under a new contract of employment in pursuance of an offer (whether in writing or not) made before the end of his employment under the previous contract… the employee shall not be regarded as dismissed" for the purposes of a statutory redundancy payment. The renewal or re-engagement must take effect within four weeks of the termination of the old contract. Continuity will not be broken and the period of time between the employee being dismissed and re-engaged will contribute towards continuous employment (section 213(2), ERA 1996).
You will see that for this to apply the offer must have been made before his previous contract had terminated. From what I understand his employment was originally terminated and then a few days later he was offered the chance to return and accepted. So initially you could argue that he was not offered the new job before his old contract had terminated and therefore the above rules do not apply.
However, there is another section (210(4), ERA 1996), which states that the continuous employment will be broken if there was more than a week's break between the two employments. To make it more complex, a week is defined as a week ending on a Saturday so for this to apply he must have had a break which included a period from a Sunday to a Saturday. As an example, if he was terminated on a Tuesday and then was re-employed the following Thursday, that would be more than a calendar week but it would not satisfy the legal requirement for a week's break as there was no full period starting with a Sunday and ending with a Saturday. So it really depends on how long the break was between the two jobs and if the above criteria has been satisfied. Hope you are still following this, I know it can be wordy?
Customer: replied 1 year ago.

Hi Ben thank you so much. His employment ended on a Monday and a new offer on the Friday. He was not paid redundancy as the company could not afford it and he agreed to wait until it could. And then he started again within the weeks period and received nothing until eventually the company went into liquidation.

I hope this stands us in good stead when holding up the insurance claim.

Thank you so much again

Fiona

Expert:  Ben Jones replied 1 year ago.
Well here lies the issue - according to what happened, there was no termination as he returned to the employer within the requisite period to allow for continuous employment. So even if he was initially terminated, he returned to them too soon and it means the earlier termination did not count and he enjoyed continuous service with the company. So I don'[t think that would help your case unfortunately because it shows that there was no termination and he preserved his continuous employment with them by returning soon enough.
Customer: replied 1 year ago.

So it would have been best if he had had a longer period of more than a week including the Saturday to Sunday period mentioned and then he would have been covered?

Thanks so much Ben

Fiona

Expert:  Ben Jones replied 1 year ago.
yes you are correct. That or not taken up the job in the first place
Ben Jones, UK Lawyer
Category: Law
Satisfied Customers: 45343
Experience: Qualified Solicitor - Please start your question with 'For Ben Jones'
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Customer: replied 1 year ago.

Thank you so much Ben - all clear :)

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