The Employment Rights Act 1996 (the law that currently covers making redundancies) says that, ‘an employee is dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to the fact that the employer ceases to carry on the business in which the employee was employed, or ceases to carry on that business in the place where the employee was employed. A redundancy will also occur when the needs of the business for employees to carry out work of a particular kind have ceased or diminished.’
In plain English this means a Redundancy situation happens when you employer has no more, or not enough, work for you and your colleagues – so you are made redundant (for example if your employer closes or relocates the business, or now needs fewer workers).
However, it has now been confirmed that a Redundancy situation can also arise where an employer wishes to make a full-time position part time due to a reduction in work (as this is a diminution in work). A recent employment law case from the Employment Appeals Tribunal (Packman v Fauchon) confirmed that an employee who was dismissed because her employer had a downturn in work which consequently reduced the employees hours of work, was a dismissal by reason of redundancy (even though there was no reduction in the number of employees required).