If you’ve just been made redundant – or suspect you’re about to be – you’ve probably got lots questions.
Questions like what your notice period will be, what kind of redundancy package you’re entitled to and what you can do to find a new job during your redundancy notice period.
You may have heard it’s easier to get another job when you’re already employed. That might make you keen to leave during your redundancy notice period. But leaving could be the wrong choice if you lose your redundancy payment as a result.
So is getting another job during the redundancy notice period the obvious choice or not? The answer isn’t straightforward because your personal circumstances are going to be unique.
How long is your notice period?
The length of your notice period will have a big impact on the likelihood of you being able to get another job during that redundancy notice period.
Other factors that you’ll need to consider include whether you’re offered in pay in lieu of notice (PILON) or gardening leave, whether you’re told to use your remaining holiday before you leave and whether your employer agrees you can leave you job early in the event that you find another job during the notice period.
So before you do anything, understand the details of your specific situation.
How long will your notice period be?
If you’ve worked for your employer for between a month to two years, you’re entitled to statutory notice of at least a week. This is the absolute minimum notice period. If you’ve worked for your employer for two years or more, you’re entitled to one week’s notice for each year you’ve worked, up to a maximum of 12 weeks.
If you have a non-statutory contract with your employer, your notice period will be ‘contractual notice’ not statutory notice. That means your period of notice could be either shorter or longer than statutory notice and will be set out in your employment contract.
Your pay during your notice period
You’ll be paid as normal during your notice period if you’re on a statutory notice period and you’re entitled to your normal pay in addition to any redundancy pay.
You’ll still get your pay if you’re:
- On holiday.
- Off work due to sickness or injury (even if you’d normally get statutory sick pay instead).
- Off work because you’re pregnant, on maternity, paternity, adoption or parental leave.
- Available and willing to work but aren’t given any work to do.
- Your pay entitlement during maternity leave
If you’re made redundant during your maternity leave, you’re entitled to receive your normal full pay for that whole period. And if you’re getting statutory maternity pay, your employer can reduce your notice period pay so you’re not paid for both your notice period and maternity leave at the same time.
But if you’re entitled to pay in lieu of notice (PILON), your employer can’t take this approach. That means you’ll get the full amount of statutory maternity pay and your full notice pay too. In this case, you would receive more than your statutory maternity pay.
If you’re on maternity leave and you’re getting full pay, whether you decide to look for another job will depend on how far through your maternity period you are and how much you’re being paid.
Your pay entitlement if you on contractual notice
If you have contractual notice, you’ll be entitled to your pay in the same way as if you were on statutory notice. So if your contractual notice period is three months, you’ll be entitled to three months’ pay (regardless of your redundancy package). The only difference is that if you’re on sick leave or maternity leave, you’ll get sick pay and maternity pay. This could be less than your normal full pay.
Of course, you still need to turn up for work so if you decide to leave your employer before the end of your notice period, you won’t get paid by that employer either.
Deciding whether to work your notice period
When your company tells you that it’s making you redundant they should also confirm your notice period and your end date. It’s important to remember that your notice period only starts when you have a formal redundancy notice and you’re given a finishing date. So don’t mistake the possibility of redundancy for redundancy itself.
Will you be paid during your notice period if you don’t work?
You’re entitled to get your notice pay (including all your work benefits such as pension contributions) even if your employer says you don’t have to work during your notice period. However, if your contract states that your employer can cease your benefits when you’re made redundant, they can avoid making those payments. Check your contract.
If you don’t have to work your notice period, it could mean that:
- you’re on gardening leave i.e. you’re paid as usual until the end of your notice period, but you don’t have to go to work.
- you receive pay in lieu of notice (PILON) i.e. you get all your notice pay in one go and your job ends straight away.
Of course, if you’re in either of these situations, you can go ahead and start looking for a new job as soon as you want to although if you’re on gardening leave, you may not be able to start a new job until your official leaving date.
What does gardening leave mean?
If you’re given gardening leave, you’ll get your normal pay at the normal time. You’ll also get any benefits you’re entitled to. However, your job won’t officially end until you have reached your finishing date (even if you don’t have to go to work).
On the plus side, this could increase your redundancy pay if the extra time you’re employed leads you to complete another full year of employment. On the minus side, it means you can’t start a new job unless your current employer agrees, because under the terms of gardening leave, your employer can still ask you to come into work from time to time.
What does PILON mean?
PILON is by far a better approach to redundancy for you as an employee. Not only will you get your full notice pay in one go, your job will end immediately, leaving you free to look elsewhere. There are some differences in how you pay tax depending on your contact.
If your contract states that your employer is permitted to give you pay in lieu of notice or your employer often gives people pay in lieu of notice, then you’ll pay tax as normal and your job will end straight away.
However, if pay in lieu of notice isn’t mentioned in your contract and your employer doesn’t usually give it, you could have two additional benefits.
You won’t pay tax on your notice pay unless your notice pay and your redundancy pay together add up to more than £30,000.
Even though you don’t work your notice period, your statutory notice period is added to your length of service, which could increase your redundancy pay.
Your decision to leave your job during your notice period is going to be influenced by your personal financial situation, the redundancy and notice pay you’re entitled to and whether you’re on gardening leave or receive PILON. Only you will know whether the money you’re entitled to is worth waiting for or not.
Taking holiday during your notice period
It’s up to your employer to decide whether you can take holiday time during your notice period. However, it’s worth remembering that you’ll be paid for any remaining holiday time that’s left when you leave your job, but check your contract for details.
You may not want to take your holiday during your redundancy notice period, but your employer can tell you to do this. However, your employer must give you notice at least two days in advance for every day of holiday you take. That means if they want you to take five days’ holiday, they’ll have to give you 10 days’ notice. Again, check your contract for details.
Leaving your job during your notice period
If you get another job, you might want to leave your job during your notice period. If this is the case, you can ask your employer to change your finishing date. If they agree to change the date, you’ll still be entitled to your redundancy pay although, of course, you won’t continue to be paid by your old employer. Most employers will agree simply because it saves them money.
However, don’t leave early without your employer’s written agreement or you’ll be deemed to have resigned. That means you won’t get your redundancy pay. If your employer doesn’t agree to you leaving early and you don’t want to lose your redundancy pay, you may need to ask your new employer if you can start working for them at a later date. Depending on your personal situation, the security of having another job to go to may outweigh the benefits of having some extra cash in the form of a redundancy payment.
If you have any problems with notice or pay
Problems with notice and pay can arise if your employer:
- doesn’t pay you for your notice period.
- tells you to leave straight away without giving you pay in lieu of notice.
- doesn’t pay you what you’re entitle to receive.
If you find yourself in any of these situations, talk to your employer before doing anything else. Before going to an employment tribunal or taking legal action, remember you can only get money from your employer if it hasn’t been paid to you. You won’t get more money than you’re due. It’s worth bearing in mind the cost to yourself financially and emotionally before making a legal claim as this could get in the way of you finding a new job and moving on in your life and career. If you’re owed a lot of money, it might only be worth it but if the amount is insignificant, deal with the anger, take a deep breath and leave it behind.
Leaving on a good note
Whatever the circumstances around your redundancy, and whatever you feel about being made redundant and the company you worked for, it’s important to think long-term and leave on a good note. After all, this is an employer you may need a reference from in the future and it’s even possible that you might return to work for them again later in your career. Also, people know each other in most industries – often by reputation if not in person – so leaving on a bad note could cause you problems later in your career.
Apart from anything else, leaving any situation in a state of rage and hurt won’t help you. Look beyond the immediate moment and focus on the future. If you need to, seek out counselling so you can work through your feelings.
Being made redundant doesn’t necessarily mean nobody will be doing your work after you’re gone. That means you may need to do a handover. That handover may be directly to the person taking on your tasks or it could be a handover to someone yet to be hired.
A good handover can give others a very positive impression of you as a professional person. You may think you’ll never see these people again, but life can bring people back into your life in unforeseeable circumstances. Apart from anything else, knowing you behaved well will make you feel good about yourself.
Handling redundancy well
Redundancy can be stressful, emotional and challenging. It’s easy to get wrapped up in the moment and make short-term decisions.
If you’re not sure of your next step, consult a career coach so you can gain perspective and clarity about what happened and what you want next. Having professional advice is often the best way to understand your situation and make choices that are right for you.
Whatever happens, remember that while redundancy may signal the end of one part of your career, it can also be the start of another more exciting one.
Do reach out to us if you need any further advice or help. We have many different packages to help you to secure a new job in your chosen profession quickly.