Staff volunteering for redundancy are still dismissed

It may seem a little counterintuitive, but staff volunteering to accept a redundancy package are normally regarded dismissed for employment rights purposes.  That was the main reason why the Employment Appeal Tribunal has recently overturned a decision by an employment judge, who had struck out an unfair dismissal claim from a care home receptionist who had volunteered for redundancy.

Although she had agreed to go, she claimed that the redundancy was not genuine and had been carried out unfairly. When ordering her case to proceed to a full merits hearing, the EAT approved this succinct summary of the legal position from a leading employment law text book:

“volunteers for redundancy do not agree to terminate their contracts; rather, they agree to be dismissed for redundancy”.

That is why it is important for employers to realise that even when staff have volunteered to go, typically in return for an enhanced redundancy package, this does not preclude bringing a claim for unfair dismissal.  If the package is generous enough, there may be little incentive to claim. But the only way of eliminating this risk is to require such employees to enter into a settlement agreement in return for receiving their redundancy payment.

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