With a redundancy notice, the employer terminates the contract of employment of the employee on grounds of redundancy. The example is suitable for use in a simpler redundancy case, where the contract is of indefinite duration, the employer has no other job to offer the redundant worker and there is no collective redundancy.

In what cases is an employee allowed to be made redundant?

According to the Employment Contracts Act (§ 89, paragraph 1), an employer can terminate an employee's contract due to redundancy when continuing the employment relationship under the agreed conditions becomes impossible due to a reduction in work volume, reorganization of work, or the termination of another type of work. Redundancy is also permitted in the event of the employer's closure of operations or bankruptcy (Employment Contracts Act § 89, paragraph 2).

Does the employer have to offer the employee another job before making them redundant?

Before terminating the employment contract due to redundancy, the employer must offer the employee another job if possible (Employment Contracts Act § 89, paragraph 3). The employer must offer the employee a job that they are capable of doing. Therefore, the offer cannot be limited solely to the employee's professional work. If the employer does not have suitable work to offer, they are not required to do so. Additionally, the employer is not obligated to offer another job if the reason for redundancy is the closure of the employer's operations or bankruptcy.

How much notice must the employer give before making an employee redundant?

The notice period depends on how long the employee has been employed with the employer (Employment Contracts Act § 97, paragraph 2):

• Less than one year of employment: at least 15 calendar days;
• One to five years of employment: at least 30 calendar days;
• Five to ten years of employment: at least 60 calendar days;
• Ten or more years of employment: at least 90 calendar days.

What happens if the employer does not comply with the notice period?

In this case, the employee has the right to claim compensation from the employer for the period they would have been entitled to if the notice period had been followed (Employment Contracts Act § 100, paragraph 5). The employer must pay the employee compensation based on the average daily wage for the workdays that fall within the notice period but for which less notice was given.

How much compensation must the employer pay to the employee in case of redundancy?

The employer must pay the employee the earned wages and compensation for any unused annual leave. In addition, the employer must pay redundancy compensation equivalent to one month's average salary if the employee is made redundant from an indefinite-term employment contract (Employment Contracts Act § 100, paragraph 1). For a fixed-term contract termination, the employer must pay compensation equivalent to the wages the employee would have been entitled to until the end of the contract (Employment Contracts Act § 100, paragraph 3). As an exception, the employer does not need to pay compensation for fixed-term contracts if the termination is due to force majeure or bankruptcy. If necessary, compensation must also be paid for failing to comply with the notice period.

Which employees cannot be made redundant?

The employer cannot make an employee redundant if they are pregnant, entitled to maternity leave, or are on parental leave, adoption leave, or paternity leave. This prohibition does not apply if the redundancy is due to the employer's closure of operations or bankruptcy (Employment Contracts Act § 93, paragraph 1).

Which employee has the right to stay in the job during redundancy?

Employees’ representatives (e.g., workplace health and safety representative, employee representative, union representative) and employees raising a child under the age of three have the right to stay in the job during redundancy (Employment Contracts Act § 89, paragraph 5). The right does not apply if the reason for redundancy is the employer’s closure of operations or bankruptcy. The right applies only in situations where multiple employees are doing the same job. For example, if the employer has only one cleaner, they can be made redundant even if they are an employee representative because there are no other comparable employees.