Redundancy while on or shortly after maternity leave or shared parental leave
If you are being made redundant there are a number of things you should consider. Firstly, you should look at whether it is a genuine redundancy situation. Redundancy can happen when your place of work closes or moves, either temporarily or permanently, the type of work you do will no longer be done at your place of work, or fewer employees are needed to do the type of work that you do. If you have been made redundant but the person covering your maternity leave has not, this is not likely to be a genuine redundancy and you should seek legal advice straight away.
Secondly, you should look at whether your employer’s selection criteria are fair. If you are selected for redundancy because of pregnancy or maternity leave you can claim unfair dismissal and sex discrimination.
Employers must give employees as much warning as they can of impending redundancy, and must consult with employees. Failure to consult with an employee because she is on maternity leave may be sex discrimination.
If you are to be made redundant during maternity leave, regulation 10 of the Maternity and Parental Leave etc Regulations 1999 says that you must be offered any suitable alternative vacancies. You do not have to apply or be interviewed for any suitable alternative vacancy but should be offered it in priority to your colleagues. If your employer insists that you must apply, seek advice.
If a suitable alternative vacancy exists and you are not offered it you may have a claim for automatic unfair dismissal and sex discrimination.
This protection is only available to women on maternity leave, but similar protection is available to either parent on shared parental leave.
As soon as you return to work you are no longer covered. However, selection criteria must still be fair and time off because of pregnancy or maternity leave must not be taken into account. When the protection begins will depend on the facts, so get advice as soon as you know there might be redundancies.
To be a suitable alternative vacancy, the terms and conditions of the new job must not be substantially less favourable to you. This must be determined in each case objectively (considering the whole of the job: status, content, salary, hours and location) but with reference to your individual circumstances.
If your employer offers you a suitable alternative vacancy and you turn it down unreasonably you will lose your right to a redundancy payment. Reasonably here depends on your reasons for rejecting it and can include your health and your personal or family commitments.
Unlike women on maternity leave, pregnant women who have not yet started maternity leave have no special protection in a redundancy situation.
Even if the redundancy is genuine, fair and you have been consulted, if you have at least two years’ service with your employer you will be entitled to a redundancy payment. If you are dismissed during your maternity leave or shared parental leave (ML/SPL), the redundancy payment must be calculated using your normal week’s pay as received before ML/SPL.
You will also be entitled to contractual rights such as holidays which have built up until the end of the notice period.
If you are made redundant BEFORE the qualifying week (the 15th week before the expected week of childbirth), you will not get SMP but you may be able to claim MA.
If you are made redundant IN or AFTER the qualifying week but before the maternity leave starts, you are still entitled to SMP (as long as you meet the qualifying conditions) for 39 weeks unless you start a new job.
If you are made redundant during the Shared Parental Leave, you will only continue to be entitled to ShPP if you have booked it for the full period. It does not automatically continue to be payable like SMP.
The statutory minimum period of notice is one week’s notice for each year of continuous employment, up to a maximum of 12 weeks. Some employees are entitled to more than the statutory notice period because of the terms of their contract of employment. If your contract offers only the statutory minimum you are entitled to be paid notice pay in full.
But if you are entitled to notice pay, your employer can offset your maternity pay against the notice pay for any week of your notice period where you would be getting maternity pay. For example if you were dismissed two weeks before your Statutory Maternity Pay (SMP) runs out, and your employer has to give you four weeks notice because you have four years of service, what you would actually receive would be two weeks SMP, plus two weeks of the difference between your SMP and normal pay, plus two weeks of normal pay. In other words, what would go into your bank would be the same amount as four weeks normal pay, but this amount would include your SMP. If your employer is paying in lieu of notice, they may not be entitled to offset your maternity pay. Seek advice if you are not sure.
This advice applies in England, Wales, Scotland and Northern Ireland. If you live in another part of the UK, the law may differ. Please call our helpline for more details