HR/employment advice urgently required

mmarks

Member
Messages
116
Hi all,

Hopefully someone here has HR/employment law knowledge.

I have just been informed that my employer is going to put me (and many other staff) on a 60% salary - asking us to work 3 days a week.
They are sending me a letter (haven't received it yet). What are my options?

If I sign it then I am on 60% of my salary which doesn't cover the bills.

If don't sign it - what does that mean? What can they do? I think I would rather be made redundant as I am on 3 months notice so if they paid me the 3 months in one lump sum it would be tax free. If I don't sign it - can they enforce it or would they have to make me redundant/fire me?

Michael
 

Hawk13

Member
Messages
829
It is not necessarily legal to put your notice period into your redundancy package so it becomes tax free.

You should also consider worst case which could be that the company declares bankruptcy and you get nothing.

Or that they make you redundant, insist you work your notice and then only pay you statutory redundancy (1.5. weeks per year?)

As this is going to have a profound impact on you, I would suggest waiting for letter and then seeking a professional adviser.
 

allandwf

Centenary Club
Messages
9,047
Surely they can only make you redundant if your position no longer exists? I hope everything works out ok for you.
 

mmarks

Member
Messages
116
I suppose where I'm coming from is that I don't think the company will still be here is 3 months time.
If I take the 60% salary then they go under, I'm entitled to nothing.
If I don't sign the letter then can they enforce it or would they have to fire me/make me redundant? I wouldn't get any redundancy money (only been here a year) but I am on 3 months notice so would rather have 3 months money at 100% than 60% until they fold.

Make sense?
 

Scaf

Member
Messages
2,435
I believe to force you into a 3 day week they would need to have provided for that in your contract or seek your agreement. ( even furloughing requires agreement of the employee unless there is provision in the contract).

If you don’t agree they could make you redundant on the basis the 5 day a week job no longer exists as there is only 3 days work available. Then it comes down to their redundancy policy, most won’t pay anything if less than 2 years employment (stat min requirement) as has been said there is no legal requirement to pay you your notice, they could make you work it (depending on their policy) and they could pay stat redundancy that caps the amount you get to £538 pw
Ask for their redundancy policy / terms and go form there.
 

Devonboy

Member
Messages
877
Hi all,

Hopefully someone here has HR/employment law knowledge.

I have just been informed that my employer is going to put me (and many other staff) on a 60% salary - asking us to work 3 days a week.
They are sending me a letter (haven't received it yet). What are my options?

If I sign it then I am on 60% of my salary which doesn't cover the bills.

If don't sign it - what does that mean? What can they do? I think I would rather be made redundant as I am on 3 months notice so if they paid me the 3 months in one lump sum it would be tax free. If I don't sign it - can they enforce it or would they have to make me redundant/fire me?

Michael
They can’t force this change of terms on you....you would have to agree to it...but as you identify the other option is redundancy. They will be keen to avoid redundancy because it worsens their cash flow (immediate payment of 3 months salary plus stat redundancy) - it is also worth considering how long is the part time period for - could you get a time limit on it - say 10 weeks? If you do get redundancy make sure you agree a future reference (you don’t want to look a **** by not being in all this together etc)
 
Messages
918
You should consider that your employer will have taken legal advice on their offer. This offer would put the balance of probability of defending any counter claim by you in their favour and involve costs for you in making a counter claim against the uncertainty that you may lose and have nothing and pay your and their legal costs. I managed people out of the organisation in a senior corporate career and one thing they always under-estimated was my legal leverage and their solicitor egging them on that they had a case when they had no chance of winning a counter claim. I'd think carefully about their offer before contesting it. They are very likely to have taken legal advice to mitigate against a counter claim succeeding. Employers can be masters at putting people between a rock and a hard place. Not comfortable anf not what you want hear, but a real dose of reality I'd say. We are in unprecedented times and I expect we will see more of staff being managed out of organisations in ways where counter claims are unlikely to succeed. If its a SME, they might not be bullet proof. My life of hiring and firing was in a global FTSE top 20 company. We had teams of lawyers everywhere that just quoshed counter claims and we'd see them in court - but they'd fall way before then and take away the legal minimum package instead of an enhanced package on offer - all because they were spurned on by a solicitor who persuaded them they had a case without highlighting that the employer was likely to have taken legal advice on how to get rid of staff with any counter claim unlikely to succeed (unfair dismissal, redundancy etc). Not easy situation but do reflect on their offer and recognise it will (or should) be based on legal advice. It is entirely down to you how you bat at the crease.
 

Oneball

Member
Messages
4,046
How solvent are they? It may be that they’re so precarious that consideration of any unfair dismissal or going to ACAS is irrelevant as they’ll become insolvent before it gets there.

Would you be in a worse situation without a job in three months than you would be on 60% for three months?
 

MarkMas

Member
Messages
4,240
.... It is not necessarily legal to put your notice period into your redundancy package so it becomes tax free. ...
My understanding is that in a redundancy situation anything that is a contractual commitment (such as paying off three months' notice) would be taxable.

.... Or that they make you redundant, insist you work your notice and then only pay you statutory redundancy (1.5. weeks per year?) ....
Thant would be the normal strategy, if you don't take the offer. Make the position redundant, with basically no redundancy money as you have not been there long enough, and then make you work the notice period if you want the notice money.

BUT in the current situation, I don't know whether they can make your position redundant and then furlough you during your notice period, so that the Government has to refund 80% of what they pay you.

You need a lawyer. The only good ones I know are a ferociously good, but ferociously expensive London firm.
@MrPea or @CatmanV2 may know someone....
https://www.sportsmaserati.com/index.php?threads/hr-experts.29801/
https://www.sportsmaserati.com/index.php?threads/the-good-morning-thread.1757/page-3593#post-751580
 

CatmanV2

Member
Messages
35,492
I think several people have the right of it on this thread. Sadly (in this case as it were) I never needed any more expertise as I was treated fairly.

C
 
Messages
918
Hi all,

Hopefully someone here has HR/employment law knowledge.

I have just been informed that my employer is going to put me (and many other staff) on a 60% salary - asking us to work 3 days a week.
They are sending me a letter (haven't received it yet). What are my options?

If I sign it then I am on 60% of my salary which doesn't cover the bills.

If don't sign it - what does that mean? What can they do? I think I would rather be made redundant as I am on 3 months notice so if they paid me the 3 months in one lump sum it would be tax free. If I don't sign it - can they enforce it or would they have to make me redundant/fire me?

Michael
They are not making you redundant. If they were, they would communicate that to you in writing and engage in a consultation process.

What they are doing (as they may argue in a legal challenge) is that there is a reduced demsnd for your role given the unprecedented situation we are in. They cannot sustain cash flow as it is and so they are taking 'reasonable' steps to stay afloat by their actions.

You cannot ask or demand redundancy.
You have NO claim for dismissal - because they have not dismissed you and neither do they intend to from what you make out. You do not share details of your employment contract or terms and conditions making it difficult to give more accurate guidance.

If the company goes down, you will have no claim in any case as you'd be one of several groups of unsecured creditors.

If you lose your job, you should consider that you could be on zero pay for many months - depending on your age, location, industry. In all likelihood, you may not qualify for welfare support such as Universal Credit. Things are going to be at or close to recession for many years after this pandemic is over.

I was coaching a senior exec from a top 3 global pharmaceutical company that was a client of mine after he resigned without a job to go to following numerous disagreements with his very senior leader. He was 50s and out of work for 30 months. He finally got a job with a small local company paying 30% of his former senior pay package.

He spoke 4 languages fluently, was a qualified doctor and P&L General Manager.
And he struggled to get back to work.

So my suggestion to you, is to think very carefully about their proposal. Do not engage in trying to negotiate redundancy (it defeats the purpose of hheir offer as they will pay out more - where they are trying to save and reduce outgoings). They will (or should) have taken legal advice about changing your terms and contracts to ensure little chance of a legal challenge from you succeeding or even being made.

Speak to a solicitor, but I think after spending several hundred pounds on 1-2 hours of legal advice at £280/hr plus VAT you'll take the decision to accept their offer as you have been placed between a rock and a hard place. A good solicitor will likely highlight what I have said in my two posts.
I am not a solicitor

Consider also litigation by all means. But remember to search for defining and answering the vexed question: "What is your loss?" Then weigh that value of loss against the simple fact that to litigate, your costs to pursue that loss are likely to start at around £30,000!

I have talked to so many people in similar situations as I had a lot of corporate senior experience of firing staff, managing them out and negotiating their hire. It depends on what your terms snd conditions are in the contract and the strength of your employer's ability to prove reasonableness under unprecedented situations. They are offering you continued employment on different terms. That may be better than declining and having nothing. There is no redundancy. By declining, a lawyer may tell you that you dismissed yourself.

Caught between a rock and a hard place.
Let us know how you decide.
 
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Messages
918
Your employer will have taken advice on what is legally called 'force majeure' where either party is unable to fulfill their contract due to unforeseen situations outside their control. That event is Covid-19. If no such clause exists between you, a good law firm can still help an employer get round this to change the contract - as you are being offered in the soon-to-arrive letter.
 
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MaseratiGent

Member
Messages
145
Your employer will have taken advice on what is legally called 'force majeure' where either party is unable to fulfill their contract due to unforeseen situations outside their control. That event is Covid-19. If no such clause exists between you, a good law firm can still help an employer get round this to change the contract - as you are being offered in the soon-to-arrive letter.
While this situation is deeply unpalatable do remember your employer is likely facing an existential crisis. If they have haircutting everyone's salaries it's likely their only choice and better than the business folding. This is increasingly common. You are not alone. If you win your argument it will affect all employees and therefore potentially bankrupt the firm...
 

mmarks

Member
Messages
116
Thanks all for your replies and advice - all sound.

I have calmed down a bit and taken the sensible approach by accepting what it is.

Having read through my contract, it stated that any significant change to my terms would be notified with not less than one months written notice. I consider a 40% hours and salary cut to be 'significant' but they are starting it immediately (i.e. not a months written notice). I talked this through with the partners and they aren't going to shift on their decision. Over a month I will lose about 8 days pay which I guess would be less than any legal fees to challenge them. So what I have done is accepted the situation but written to them for my files explaining that I believe they have acted wrongly. I'll leave it at that.

Michael
 
Messages
918
They have the leverage. Sadly you don't.
When I used to do this, I had all the cards prepared. Nobody took me on, nobody reached court but those that tried incurred huge costs and hardened my approach to give them the absolute minimum legally compliant package. Those that had sense accepted the decision for what it was, came out the other side better and still sent me Christmas cards for many years.

I'd say you have accepted the situation. Making file notes that you want would not be advisable. They are likely to see restructuring downstream, and there is a high risk they restructure you out of the business (it really does happen, trust me).
 
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Scaf

Member
Messages
2,435
I'd say you have accepted the situation. Making file notes that you want would not be advisable. They are likely to see restructuring downstream, and there is a high risk they restructure you out of the business (it really does happen, trust me).
I would agree that this is sound advice, if you are accepting the pain, there is nothing to be gained by registering your disagreement but plenty to use..........
I hope the impact won't be too great financially for the family, so many people will going through similar or worse. I guess you have the opportunity to take on some sort of work in the two days you have free each week that could top up the bank balance a little.
Best of luck.
 

Scaf

Member
Messages
2,435
Trade Union wouldn't help apart from to drag things out perhaps pushing the company under.

If there is not enough to work to keep all the workforce on 100% surely 60% employment for everyone is better than none, it's very ******* the employees though.

Some employers I am aware of are negotiating pay cuts with unions, but still 100% hours to be worked....... unions main aim here would be to keep worker employed, but treated fairly.

Providing they follow due process and gets employees concent the union would most likely support the move and is unlikely to be able to challenge it.