Redundancy: information for employers

​​What is redundancy?

In general terms, redundancy involves dismissing a member or group of staff from their job when:

• a whole business closes down, or is expected to close down
• a business closes down in a particular place, or is expected to close down
• the requirements of the business for employees to carry out work of a particular kind cease or diminish because:
  • the business diminishes
  • productivity increases
  • the work is done in a different way

Contributions and redundancy payments

Contributions are not due on a redundancy payment, but are due on the following:

• wages
• holiday pay
• payment in lieu of notice

Advice and guidance on redundancy

Jersey Advisory Conciliation Service (JACS) provides a free employment relations service to employers of all sizes.

JACS website

Consultation process to follow when making redundancies

Under the provisions of the Employment Law 2003, employees have statutory rights. These include the right to be consulted when redundancies are being contemplated by an employer, and a right against unfair dismissal. 

One of the most important aspects of a consultation on potential redundancies is that it should be a fair and transparent process, so that both employers and employees are clear about what is required in order to engage properly. This is especially important in the current economic climate and the difficulties facing businesses and their employees.

There is a difference in the way individual and collective consultations are regulated in the Employment Law. There is a set process to be followed when employers are contemplating redundancies of 12 or more employees within a single 30-day period. For employers with fewer than 12 employees the same statutory process does not apply, but the principles of fairness and transparency are equally important. 

Employers will find it helpful to be aware of the need for fair consultation with employees. The principles can be summarised as: 

• the duty to consult with the employee 
• the duty to warn of redundancy 
• the duty to establish fair criteria for selection of employees for redundancy 
• the duty to explore alternatives to redundancy 

These are well-established criteria, set out in previous judgments of the Employment Tribunal. They apply equally to the statutory process involving 12 or more employees and to redundancy situations involving fewer than 12. 

The Jersey Law website contains details of judgments of the Jersey Employment and Discrimination Tribunal.

Support

Advisers can provide support to organisations where employees have been given notice on redundancies. Our advisers can visit your workplace to give advice on a one-to-one basis and to deliver presentations to small groups. They can tell you what advice and support is available through the States of Jersey, including benefits, jobseeking and training.

Completing the redundancy notice form allows Employment, Social Security and Housing to make contact with you at the earliest opportunity to offer support where a large number of your employees are facing redundancy.

Insolvency Benefit

Insolvency benefit​​​