Hi,
An employee was recently made redundant, due to leave the end of this month.
Her manager has asked if she can come back after a one week break in service - stating she doesn’t need to take a 4 week break in service because she is coming back on a FTC.
Can anyone confirm if this is the case?
Is there any deviation because there is a change from a permanent contract to FTC??
Thank you,
Laura
It sounds as if the redundancy doesn't need to take place right now. If the FTC opportunity is available when the employee's role comes to an end, they could move straight onto the FTC. During their time on the FTC, if a permanent opportunity arises they could be redeployed into this, thereby protecting their employment and avoiding redundancy. If there isn't, when the FTC draws to a close, they could either move to another FTC (if there's one available) or alternatively they'd be entitled to redundancy at that point and this would include recognition of the entire length of service including the time worked on the FTC.
That's correct Laura - only if the earnings etc of the FTC offered differed significantly from the existing ones might there be any need to do the redundancy first. Indeed, you could if you wished enhance the severance terms a bit for any redundancy arising at the ending of the FTC.
The problem with agreeing this all before they leave is that can make any break in service irrelevant. The FTC is likely to have continuous service (or at least risk of) with original contract
The issue is that the redundancy has already been agreed and the employee specifically asked to opt out of the selection criteria due to receiving a large package (10 years service). However, her manager gave her the hope there would be opportunities to come back. And told her a one week break in service is sufficient due to coming back on a FTC.
The employees last day is 30 April.
Laura, the reduncdancy may have been "agreed", but that won't bring it into line with HMRC's requirement that for the payments to be tax-free there should be no expectation of further work of any kind for the person to do. There are plenty of instances where HMRC has considered a break of up to 2 months as insufficient because an intention of re-engagement at another site existed.
Just be prepared to have to explain to the person that HMRC would well pursue them for tax on any redundancy payments. Be prepared also for a potential fine.
If you want some certainty, call your HMRC office and explain the situation, asking them to clarify their position.
The only way the manager is right is if it is a very short term Ftc and HMRC do not pick up on it and no other issues arise.
In my experience FTCs drag on (and on)
