Redundancy Protection Update

Changes to Redundancy Protection
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The government is introducing the new Protection from Redundancy (Pregnancy and Family Leave) Act 2023 on the 24th of July 2023. The new law on redundancy protection provides priority status for redeployment opportunities in the event of redundancy to:

  • pregnant employees and/or
  • employees recently returning from parental leave.

What Are the Changes to Redundancy Criteria?

Under the current law on redundancy criteria, employees on maternity leave, shared parental leave or adoption leave are given special protection in the case of redundancy. The current law means that the employer should give these employees leave priority access to redeployment opportunities over other redundant employees before the employee is made redundant. This is if an offer of a suitable alternative role is available.

Under the new Protection from Redundancy (Pregnancy and Family Leave) Act 2023 the priority status extends to pregnant employees and those who have recently returned from maternity leave and shared parental leave.

Although the new act is to be introduced in June 2023, the act requires further regulations from the government. As a result, the government will be detailing how the entitlement will work. Therefore, it is expected that these additional regulations will not come into force before April 2024.

Who is Covered in the New Redundancy Criteria Update?

Under the new Redundancy Criteria Act, the act extends protection to:

  • A pregnant employee who is currently in the protected period of their pregnancy
  • An employee, who is suffering from a recent miscarriage
  • Maternity returners
  • Adoption leave returners
  • Shared parental leave returners

Currently, the act is providing limited information, therefore making the new rules difficult for employers to carry out.

This is because the government are not yet defining the length of protection or how long a “protected period” of pregnancy is. Additionally, the government have not yet defined how they will be calculating the “protected period” of pregnancy.

However, from the consultation and the government’s press release, we can estimate that the length of protection to be 6 months for employees returning from adoption or maternity leave. Furthermore, it is likely that the “protected period’ of pregnancy will start once the employee has informed the employer of their pregnancy. However, new provisions allow for this period to begin after the end of the pregnancy. Therefore, the new bill covers miscarriages that have taken place before an employer was even aware of the pregnancy. This allows for an employee to receive protection.

Currently, the law only recognises miscarriages that happen after 24 weeks of pregnancy. This is when entitlement to maternity leave is granted.

How Long Is Protection for Employees Taking Shared Parental Leave?

Until the release of the regulations, we can not define the protection of employees who are taking shared parental leave. This can be harder to define for example: if a parent is only taking one week of SPL, it doesn’t make sense to grant them six months of redundancy protection. However, there must be some form of protection that is proportionate to the threat of discrimination.

Another factor that the consultation highlights is that a mother should not be worse off if she cuts her maternity leave and then takes a period of SPL.

Does the New Redundancy Criteria Include Paternity Leave?

The new law does not offer paternity leave redundancy protection to employees. This is because the law ensures employers do not make early judgments on performance in the first few months of an employee’s return to work after a long absence. However, this long absence would not be the case with paternity leave.

What Employers Should Be Considering

As it stands, there is nothing employers can actively do in the wake of the new redundancy protection laws. However, employers can think about any implications or issues that may need addressing due to the new protections.

The new rules double the period of redundancy protection for new and expecting mothers. Informing their employer about their pregnancy at 12 weeks, taking a year of maternity leave, and receiving protection for six months afterwards, mothers receive a period of approximately two years of protection.

Concerns for Employers

In some situations, the new law could create challenges for employers during redundancy exercises. Female-dominated workforces can pose challenges for employers who must prioritise numerous employees for suitable alternative positions. Additionally, women may feel compelled to disclose their pregnancy at an early stage if a redundancy exercise is imminent.

Partners and fathers already have protection when taking Shared Parental Leave (SPL). However, extending the protection to cover the return period from SPL could require employers to become accustomed to granting men these priority rights.

Although not known to us yet, the consequences of not offering a protected employee a suitable alternative position could result in an automatic unfair dismissal.

For many people, the new rules come as a necessary change to safeguard new and expecting parents against discrimination.

However, there may be individual cases where the rules appear unjust to managers and employees. This could be where the new rules result in the loss of a high-performing employee in favour of someone with priority status. Such situations will require careful management.

Employers will need to establish systems for identifying potentially suitable positions throughout their operations, including within affiliated companies. This task may prove challenging, especially since the rise in remote work results in more suitable positions.

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All advice is correct at time of publication.