Employers must offer any employee who is entitled to statutory redundancy pay suitable alternative employment if such a position is available during the redundancy process.
At the point of the offer being made, an employee can either accept or refuse the job offer made.
Regardless of the employee’s decision, if suitable alternative employment exists but isn’t offered, employers are opening themselves up to complaints of unfair dismissal.
Here we look at whether an employee can refuse an offer of suitable alternative employment and what happens when they do.
Can An Employee Refuse Suitable Alternative Employment?
An employee can reject suitable alternative employment on the basis that it is not ‘suitable’; however, they will be ineligible for statutory redundancy pay if their refusal is unreasonable.
What counts as reasonable grounds? Reasonable grounds to refuse suitable alternative employment could include but is not limited to:
- The new position would involve a significant reduction in pay or benefits;
- The new position involves a change of location that would be too far away from the employee’s home;
- The new position would involve a change in hours that is not compatible with the employee’s child care, school or other commitments;
- The new position requires skills or qualifications that the employee doesn’t feel they have
- The new position would require an unacceptable level of skill for which the employee feels they are not sufficiently qualified; or
- There are concerns about health and safety risks associated with the new position.
- Discrimination laws are also important when considering suitable alternative job offers, as employees have the right to refuse positions allegedly chosen on discriminatory grounds such as gender, age or disability. Offers made must be based on fairness rather than any other factor.
- The employee wasn’t given enough time to consider the position
What Is Classed As A Suitable Alternative Employment?
What is deemed to be suitable employment will vary based on each individual’s case.
In general, though, any alternative offered should provide at least the same level of benefits as the employee’s prior job concerning its location, pay, status, and terms & conditions, as well as being a good match for the employee’s existing skills and ability.
Which Employees Are Entitled To Be Offered Alternative Employment?
Any employee who qualifies for statutory redundancy is entitled to be offered suitable alternative employment.
This includes any employee with two or more years of continuous service. In certain cases, employees with less than two years of continuous service can also be eligible for alternative employment offers.
Employers must always act in good faith and give any suitable alternative employment offer serious consideration.
It’s in the employer’s best interest to ensure that all employees are provided with fair opportunities and then given enough time to decide whether or not to accept the alternative job.
The Refusal Process
If suitable alternatives are available, employers must ensure that they present these offers fairly and transparently.
This will allow employees to make an informed decision on whether or not to accept the offered position before proceedings can move forward with the redundancy process.
If an employee decides to refuse the offer, they must let you know of their refusal to accept the new role before their current job ends or, if a trial period for the position is in place, before expiration.
Failure to do so will result in forfeiture of any statutory redundancy pay they are entitled to receive.
What Happens After An Offer Of Suitable Alternative Employment Is Refused?
If an employee chooses to refuse an offer of suitable alternative employment, they are considered as having been dismissed on the grounds of redundancy and entitled to any statutory redundancy pay.
If an employee has reasonable cause to refuse suitable alternative employment, then you cannot hold it against them and must refrain from taking any disciplinary action.
If an employee unreasonably refuses an offer of suitable alternative employment, they are considered as having been dismissed on the grounds of redundancy but lose their entitlement to statutory redundancy pay.
Advice For Employers During Redundancies
Redundancy can be a long and emotive process, but it must be managed fairly and lawfully.
Failure to do so could lead to tribunal cases for unfair dismissal or redundancy pay being brought against you.
To ensure the process of redundancy in your workplace runs as smoothly as possible, we advise all employers to:
- Take notes of any conversations or considerations about potential alternative roles and the redundancy process taking place. This includes informal or formal discussions.
- Be able to show that you have fully considered any alternate positions that are available and why they could be acceptable. If no viable options exist initially, consistently assess if there will be open jobs before your employees’ current posts end.
- Make sure you give them a written offer of suitable alternative employment with details about the new role, even if an employee has already expressed that they will not accept any alternatives. This way, there are no misunderstandings or disputes down the line.
- Make sure that you give a reasonable amount of time for employees to consider offers of suitable alternative employment that you make so as not to rush their decision.
- Always talk to individuals who are hesitant about a new role, this will help to understand their concerns, and you may be able to make minor adjustments that result in them feeling more comfortable in the new position if they initially feel that it isn’t suitable.
- Create written documents showing trial period dates and jobs offered as well as new contracts of employment for any new roles that are taken up.
- Be aware that if offering new employment that is suitable for them, an employee has the right to a four-week trial period within their new job. This allotted time frame cannot be extended due to any holidays or sickness arising, and will begin as soon as they have completed their existing position. If you offer more than one suitable alternative role, there will be a four-week trial period for each position.
- Check that if your company offers an enhanced redundancy pay, that it reflects the statutory position regarding the acceptance or refusal of suitable alternative employment.
- Make sure that the payment or nonpayment of redundancy pay based on a decision to accept or refuse suitable alternative employment is made to employees going through the redundancy process in writing.
- Be aware that if an employee is denied redundancy pay because they believe their refusal of a new role was unreasonable, they could escalate the matter formally through either an early conciliation through ACAS or eventually bring a claim in an employment tribunal for redundancy pay or unfair dismissal. In either case, it would be your responsibility as the employer to show that the employee’s refusal of the job offer was unreasonable, therefore they were no longer entitled to redundancy pay.
Summary & Next Steps
To ensure that no legal issues arise from redundancies, employers are required to offer any at-risk employee any applicable job openings or potential ones that might appear within their organisation before making them redundant.
An employee can refuse any offer of suitable alternative employment made, but if they do so without a reasonable reason, they give up their right to redundancy pay.
If an employee is found to have been dismissed unfairly due to their refusal of suitable alternative employment, then they may be able to claim unfair dismissal.
If you would like support with managing and understanding your HR and employer responsibilities regarding any aspect of the redundancy process, please contact us.
We can guide you through offering suitable alternative employment options, settlement deals, and conducting a fair and lawful redundancy process at work.
