Being made redundant can be a challenging and stressful time. It’s a situation that many people find themselves in, often through no fault of their own. Understanding what being made redundant means, knowing your rights, and how it impacts your Universal Credit can help you navigate this difficult period. This article aims to provide you with the necessary information and guidance to help you understand the process and implications of redundancy.
Understanding Redundancy
Firstly, let’s clarify what does being made redundant mean. Redundancy, or being made redundant, refers to the process where an employer reduces their workforce because a job or jobs are no longer needed. This could be due to various reasons such as company restructuring, cost-cutting, or the company closing down. It’s important to note that redundancy is about the role being redundant, not the person.
Your Rights When Made Redundant
When you’re being made redundant, it’s crucial to know your rights. These include:
- Redundancy pay: If you’ve been with your employer for at least two years, you’re entitled to statutory redundancy pay. The amount you receive depends on your age, weekly pay, and length of service.
- Notice period: You’re entitled to a notice period before your employment ends. The length of this period depends on how long you’ve been employed.
- Consultation: If your employer is making 20 or more employees redundant within 90 days, they must consult with a representative (like a trade union).
- Time off to find a new job: If you’ve been continuously employed for two years by the end of your notice period, you’re entitled to reasonable time off to look for another job or arrange training.
Impact on Universal Credit
One of the key concerns when being made redundant is how it will affect your Universal Credit. Universal Credit is a payment to help with your living costs, and it’s paid monthly or twice a month for some people in Scotland. If you’re unemployed or on a low income, you might be able to claim Universal Credit.
So, does redundancy payment affect Universal Credit? The answer is yes, it can. Redundancy payments, both statutory and any extra your employer might give you, are treated as capital. This means that the amount you get can affect your eligibility for Universal Credit. If your redundancy payment takes your total savings to over £16,000, you’ll be ineligible to receive Universal Credit. If your savings are between £6,000 and £16,000, your Universal Credit payment might be reduced.
Planning for Redundancy
Being made redundant can be a shock, but planning can help you manage the situation better. Here are some steps you can take:
- Check your rights: Make sure you’re getting everything you’re entitled to, including redundancy pay, notice period, and consultation.
- Review your finances: Look at your savings, income, and expenses. Consider how you’ll manage if you’re out of work for a while.
- Update your CV and start job hunting: The sooner you start looking for a new job, the better.
- Consider retraining: If your job is becoming redundant, it might be a good time to learn new skills or change careers.
Conclusion
Being made redundant can be a challenging time, but understanding your rights and the impact on your Universal Credit can help you navigate this period. Remember, redundancy is not a reflection of your abilities or value as an employee. It’s a result of changes in the company or industry. With the right information and support, you can manage this transition and move forward.
