This short statement is intended to explain to employers and employees Amendment No. 5 to the Employment (Jersey) Law 2003 ("principal law"). Redundancy rights will be set out in a new Part 6A of the principal law. It is not intended to cover all the requirements of the Law, nor does it represent a statement of the Law. It constitutes a guide only and detailed legal advice should be taken in relation to each individual situation. Any reference to male persons in the statement should be read as including, or being, female persons where this is appropriate.

The main aims of the Amendment are to:

• Set out an employee’s entitlement to a redundancy payment and associated conditions.
• Set out the qualifying service necessary to be entitled to a redundancy payment.
• Determine the degree of prior consultation necessary prior to a declaration of redundancy.
• Provide for Protective Awards where consultation has not taken place.
• Provide for paid time off to seek, or arrange training for, future employment.
• Provide for specific rights for employee representatives.
• Provide for a means of enforcement of these provisions.

This guideline has been published and can be accessed on our website www.jacs.org.je

The fundamental principle is that employees with a minimum of 2 years qualifying service have an entitlement to a redundancy payment of 1 week’s pay, subject to a "cap" on the value of a week’s pay, for each year of service, in addition to any statutory or contractual notice.

1. Definitions

1.1 "Affected employee" means any employee who may be affected by the proposed redundancy or who may be affected by measures taken in connection with such redundancy.

1.2 "Effective date of termination" means the date as determined in Article63 of the principal law, i.e.

a)      the date on which the notice expires, whether given by employer or employee.

b)      when termination is without notice, the date termination took place.

c)      in relation to a fixed term contract which is not renewed under the same contract, the actual date of expiry.

2. The right to a redundancy payment and qualifying service.

An employee with a minimum of 2 years’ qualifying service, who is dismissed by reason of redundancy, has a right to a redundancy payment.

There is no lower age limit of 16, nor an upper age limit of 65 (under review) 

Those who work less than 8 hours per week also have a right to a redundancy payment (under review). However, those who work less than 8 hours a week do not have a right to statutory notice nor to written terms of employment.

3. Statutory minimum redundancy payment.

The minimum redundancy payment is one week’s pay per year of service ("year" is defined as 12 calendar months). All service counts, including service before the age of 16 or after the age of 65 (this is under review but the amendment also removes the ’cut-off’ age of 65 for unfair dismissal claims, but the minimum age of 16 remains for unfair dismissal).

The value of a week’s pay is capped at a maximum level, as specified by Order of the Minister of Social Security or, where no Order is in force, by the most recent figure for average weekly earnings in Jersey published at least one month before the effective date of termination (disregarding any more recent figure published less than a month before). Currently the cap is £620 per week as at July 2009.

Redundancy payments are in addition to statutory or contractual notice periods. Statutory notice periods apply to those over the age of 16 who work 8 hours or more a week and will be amended to:

1 week’s notice if continuous service is less than 2 years

2 weeks’ notice if continuous service is 2 years or more but less than 3 years

Plus 1 week’s notice for each additional year’s continuous service up to a maximum of 12 weeks.

4. Time limits applicable to redundancy payments.

For an employee to be entitled to a redundancy payment, any of the following must have occurred within 6 months from the date of termination of employment;

·        the payment must have been agreed and paid;

·        the employee must have claimed the payment from the employer in writing;

·        a claim for redundancy payment must have been made to the Tribunal; or

·        a claim for unfair dismissal must have been presented to the Tribunal.

However, even if none of the above has occurred, the Tribunal may allow an employee to claim redundancy if, within a further period of 6 months, the employee claims a redundancy payment from the employer in writing and refers the claim to the Tribunal or presents a claim for unfair dismissal to the Tribunal. In considering a late application the Tribunal will consider the reason given by the employee for their failure to apply within 6 months and other relevant circumstances.    

5. Renewal of contract or re-engagement

Where an offer (whether in writing or not) is made to an employee, before employment has ended, to:

a)  renew the contract of employment or to re-engage the employee under a new contract of

     employment, and

b) the renewal or re-engagement takes effect immediately the previous employment ends or

    not more than 4 weeks after the end of employment

and the terms of the offer are the same as that of the previous contract, as is the normal place of employment, the employee is not entitled to a redundancy payment.

However, if the terms offered differ wholly or in part from the previous contract, the employee will still be entitled to a redundancy payment if he or she

(i)   resigns, gives notice of termination or is dismissed, and  

(ii) the principal reason for termination is that either party considers the employment is not suitable for the employee, and

(iii) the resignation, giving of notice or dismissal occurs within 4 weeks of starting work under the renewed or new contract (or such longer period as may be agreed in writing by the employer and the employee or employee’s representative). 

6. Collective consultation requirements (under review) 

6.1 Where 6 or more redundancies are proposed within a period of 90 days, at one establishment, or 2 or more redundancies are proposed at one establishment that recognises a trade union, an employer is required to consult with appropriate representatives of the employees who may be affected by the dismissals, or may be affected by measures taken in connection with the dismissals.

6.2 Consultation must begin at least 30 days before the first of the dismissals takes effect.

6.3 Appropriate representatives, for the purposes of consultation, are:

·        Representatives of a trade union, where the trade union is registered and recognised under the Employment Relations (Jersey) Law 2007.

If the affected employees are not represented by a registered and recognised trade union, then appropriate representatives for the purposes of consultation are:

·        Employee representatives appointed or elected by the affected employees for the purposes of general consultation, including matters relating to the proposed dismissal, or

·        Employee representatives elected by the affected employees for this very purpose, in accordance with the requirements of Article 60G of the law. The employer is required to make arrangements for a fair election; ensuring that sufficient representatives are allowed so as to represent the interests of all affected employees.

6.4 Subject matter for consultation.

6.4.1 Consultation must be undertaken by the employer with a view to reaching agreement with the representatives and include ways of

·        avoiding the dismissals;

·        reducing the numbers of employees to be dismissed; and

·        mitigating the consequences of the dismissals,

6.4.2 The employer must provide written information to the representatives in relation to the following:

(a) the reasons for the employer’s proposals;

(b) the numbers and descriptions of employees whom it is proposed to make redundant; 

(c) the total number of employees of any such description employed by the employer at the establishment in question;

(d) the proposed method of selecting the employees who may be dismissed;

(e) the proposed method of carrying out the dismissals, with due regard to any agreed procedure, including the period over which the dismissals are to take effect; and

(f) the proposed method of calculating the amount of any redundancy payments to be made to employees who may be dismissed.

6.5 Representatives must be allowed access to the affected employees, and be provided with appropriate accommodation and facilities.

6.6 Where the employer has invited affected employees to elect representatives, so as to allow a minimum 30 day period of consultation, but no representatives have been elected, the employer must give each affected employee the information described in 6.4.2 above.

7. Protective awards (under review) – complaint to Tribunal

7.1 Where an employer fails to comply with the requirements of collective consultation, or fails to comply with the requirements for the election of representatives then either an affected employee, an appropriate representative or an employee who has been dismissed as redundant may make a complaint to the Tribunal.

7.2 If the Tribunal finds the complaint well-founded, it may make a protective award. A protective award is an award payable to an employee who has been dismissed as redundant, or whom it is proposed to dismiss as redundant, requiring the employer to pay remuneration to each such employee for the protected period.

7.3 If, however, an employee unreasonably refuses an offer to renew his contract or an offer to re-engage him under a new contract, he is not entitled to remuneration under the protective award in respect of the period that, but for that refusal, he would have been employed.

7.4 The protected period:

·        begins with the date on which the first of the dismissals takes effect, or the date of the award, whichever is the earlier, and

·        is of such length as the Tribunal decides to be just and equitable in all the circumstances, but shall not exceed 13 weeks

·        there is no ’cap’ on a week’s pay in the calculation of an individual’s protective award (The Minister may bring forward an amendment to limit the maximum payment available as a protective award).

 7.5 Such complaints must be made to the Tribunal;

·        before the date on which the last of the dismissals to which the complaint relates takes effect;

·        during the period of 8 weeks beginning with that date; or

·        where the Tribunal is satisfied that it was not reasonably practicable for the complaint to be presented during the period of 8 weeks, within such further period as it considers reasonable.

Where a complaint is made to the Tribunal, if the employer wishes to resist the awarding of a protective award, it is for the employer to show that there were special circumstances which prevented him reasonably complying with the requirements, or that he took all reasonably practicable steps in the circumstances.

7.6 Termination of employment during protected period.

Where an employee is fairly dismissed during the protected period, for reasons other than redundancy, or where the employee unreasonably terminates his contract of employment, then subject to the provisos below, the employee is not entitled to remuneration under the protective award from the date of that dismissal or termination.

Proviso: If an employee accepts an offer to renew his contract or an offer to re-engage him under a new contract, so that the renewal or re-engagement takes effect before or during the protected period, and either:

·        During the 4 week trial period (or any agreed additional trial period) the employee terminates the contract or gives notice to terminate the contract (unless the employee’s action is unreasonable), or

·        The employer terminates, or gives notice to terminate, the new contract for a reason connected with the change to the employment,

then the employee remains entitled to the protective award.

8. Individual consultation

Although not specifically mentioned in the Law, individual consultation in respect of redundancy remain as currently required for unfair dismissal purposes, to show that a fair process has been undertaken.  While there is no set period for consultation in individual cases, where compulsory redundancy is necessary, case law shows that the Tribunal will take the matter of consultation into account i.e. the employer should follow four ordinary principles of fairness which should always be considered in situations of redundancy:

·        The duty to consult with the employee

·        The duty to warn of redundancy

·        The duty to establish fair criteria for selection of employees for redundancy

·        The duty to explore alternatives to redundancy.

9. Right to take time off to look for work or arrange for training.

An employee who is given notice of dismissal by reason of redundancy and who has been continuously employed for 2 years or more (inclusive of notice period) is entitled to take paid time off during his notice period equivalent to 40% of his normal working week (i.e. 2 working days for those working a standard 5 day week), for the purposes of:

·        Looking for new employment, or

·        Making arrangements for training for future employment

An employee who is refused permission to take such time off or who was not paid the whole of the amount due to him may make a complaint to the Tribunal within a period of 8 weeks beginning with the date on which it is alleged the time off should have been permitted (the Tribunal has the discretion to extend this 8 week period if it decides it was not reasonably practicable for the complaint to be submitted within the 8 weeks). Where the Tribunal finds such a complaint well-founded, it may direct the employer to pay a sum which could be greater than 40% of the employee’s normal weekly pay.

10. Notifying the Minister

An employer proposing to dismiss 6 or more employees due to redundancy within a 90 day period must notify the Minister in writing, before giving notice to terminate an employee’s contract. The Minister must be notified at least 30 days before the first dismissal takes place.

Such notification must:

(a) be delivered to the Minister or sent to him by post, at such address as the Minister may direct;

(b)  where there are representatives to be consulted under the Law, identify them and state the date when consultation with them under that Article began;  

(c)  set out the reasons for the dismissal;

(d) specify the numbers of employees that the employer is proposing to dismiss as redundant; and

(e) be in such form and contain such other particulars as the Minister may direct.  

After receiving a notice under this Article from an employer the Minister may require the employer to give to him such further information as he specifies. The Minister may use the information to consult with other persons as he sees fit.

Where there are representatives to be consulted the employer shall give to each of them a copy of any notice given to the Minister.

11. Tribunal Award Limits

A redundancy award made by the Tribunal is not limited by any other award payable for breaches of the employment legislation i.e. such an award would not be limited by the £10,000 "cap" that the Tribunal can award in addition to unfair dismissal compensation.

12. Rights of employee representatives

12.1 An employer must not subject an employee representative to any detriment because he or she took part in an election of representatives or did anything (or proposed to do any thing) associated with being a representative.

12.2 A complaint regarding detrimental treatment may be made to the Tribunal within 8 weeks of the alleged detrimental treatment, or such longer period as the Tribunal thinks reasonable. The Tribunal may require the employer to pay compensation of up to 4 weeks’ pay if a complaint is well-founded, and may declare that any action taken against the employee by the employer, other than dismissal, is void. A well-founded complaint of dismissal will result in a finding of automatic unfair dismissal, irrespective of the length of service of the dismissed employee.

12.3 An employee representative, or an employee candidate for election, is entitled to take reasonable time off with pay to carry out his or her functions as a representative, or to train for such purpose.

12.4 A complaint that the employer has unreasonably refused to allow an employee representative time off, or has failed to pay for all or part of that time, may be made to the Tribunal within 8 weeks (or such longer period as the Tribunal thinks reasonable) beginning with the day on which the time off should have been permitted, or was taken.. The Tribunal may require the employer to pay appropriate compensation if a complaint is well-founded.

Notes: Amendment No. 5 also:

1. Repeals Article 74 of the Employment (Jersey) Law 2003. This will have the effect of removing the upper age limit on claims of unfair dismissal.
2. Provides for redundancy payments for those with two years or more service, irrespective of whether they are aged under 16 pr work less than 8 hours a week.
3. Amends Article 56 of the Employment (Jersey) Law 2003. This will have the effect of altering the periods of notice.

Copies of the Law may be purchased during normal office hours from the States’ Greffe Bookshop, Morier House, Halkett Place, St. Helier, telephone (01534) 441020. Copies of the Codes of Practice can be obtained from Employment and Social Security Department.