Employers questions on lay-offs and short-time working

When can I lay off employees?

When there is an express contractual right agreed between you and your employee, an agreement covering the issue between the company and the union, or a national agreement for the industry that you follow. Such agreements only have contractual force if they are incorporated into each affected employee's employment contract. You might also have an implied right if you can show by clear evidence that this right has been established over a long period by custom or practice.

Do employees have any right to payment while laid off?

Not if there is a specific term in their contract allowing you to lay them off without pay. When they are laid off, they might be entitled to a statutory guarantee payment from you, limited to a maximum of five days in any period of three months. The daily amount is subject to an upper limit which is reviewed annually. On days when a guarantee payment isn't payable, employees might be able to claim Jobseekers Allowance and should contact their local Jobcentre office about eligibility.

How long can a lay-off last?

This will depend on the terms specified in the contract. However, your employee may in certain circumstances give you written notice of their intention to claim a redundancy payment.

When can I put employees on short-time working?

You must have an express or implied power to lawfully reduce the amount of pay. Normal practice would be for the workforce or their union to agree to short-time working as an alternative to redundancies. Employees placed on short-time working might be able to claim Jobseekers Allowance for the balance of the hours they don't work. Advice on eligibility can be obtained through a local Jobcentre.

Can employees claim redundancy payments because of lay-offs or short-time working?

If an employee is either laid off (receives no wages) or put on short-time working (receives less than half a week's pay) for four consecutive weeks (or for six non-consecutive weeks within a 13-week period) because of a shortage of work, the employee can give written notice that he or she intends to claim a redundancy payment.