January can often seem like the longest month of the year, with payday seemingly never around the corner and the festive period a distant memory. It is also an incredibly busy time for employment lawyers.
Many employees dwell on work related issues over the Christmas period and make decisions about their future employment on the return to work. It is often the case of New Year, new job, or wanting to face issues that have been bubbling under the surface. We often see a spate of ‘redundancies’ this time of year, with companies looking to refresh their teams and making strategic changes in line with business planning, strategy and budgets. It can be a time of change and uncertainty for many. Also, January is bonus announcement time.
Year end has closed and companies how their budgets and forecasts look for the year ahead. As many discretionary bonus schemes state that a bonus cannot be paid if you are in a period of notice or if you are not in employment when the bonus is paid (usually March) then it can be an opportunity to weed out individuals that businesses no longer want on the payroll or to whom paying a bonus seems like unnecessary expenditure.
We are often in the position of negotiating exit packages for employees who are on the cusp of achieving bonus and are unreasonably deprived at the last minute. It is often a fruitless ask as bonus schemes, as referred to above, are primarily discretionary and there is no obligation on an employer to make payment if the terms are not contractual. We often make the argument for a pro rated bonus simply on the grounds of fairness, but this falls on deaf ears.
It is highly unlikely that an employer will pay a bonus when an employee has been ear-marked for exit. Also, bear in mind that any redundancy consultation is limited when an employee has less than two years’ service. There is no statutory right to claim unfair dismissal and we have seen a raft of individuals being made redundant before their two years’ service has been achieved. This leaves an employee receiving the bare minimum notice pay, salary to termination and payment in lieu of accrued leave.
But, spring is around the corner and with warmer weather comes positivity and companies opening up new opportunities. January and February are notoriously slack when it comes to recruitment but thereafter, teams expand and people being to move again.
If you are facing a redundancy situation or a challenging time at work it can sometimes be good to use it is an opportunity to make a change, move onwards and upwards. We advise clients on exit all of the time and the resounding sentiment is gratitude for helping and supporting them to change a bad job and move on to bigger and better things.
This blog was written by Elizabeth McGlone, Partner at didlaw
