Redundancy Letter

Redundancy Letter: Confirm a Redundancy Clearly and With Care

A redundancy letter is a letter from an employer confirming that an employee's role is redundant and that their employment will end. It records the consultation and any alternative roles considered, explains why the role is no longer needed, and sets out the notice, last day, redundancy pay, final pay, company property and right of appeal. Robot Lawyer drafts the letter from your answers, for the law of the country or state you choose, and on the Verified plan a qualified legal professional checks it within 24 hours before you send it.

CONTENTS

What Is a Redundancy Letter?

A redundancy letter (also called a redundancy confirmation letter, a layoff letter or a position elimination letter) confirms the outcome of a redundancy process. Redundancy happens when the business no longer needs a role, for example because work has reduced, a site is closing or the work is being done differently.

The letter makes clear that the decision is about the role, not the person, and gives the employee the practical and financial information they need.

When Should You Use One?

• After consultation
  To confirm the outcome once consultation has finished.
• Restructures
  When roles are removed or combined.
• Closures and relocations
  When a site, team or service is closing or moving.
• Reduced work
  When the business needs fewer people for a type of work.

If you are telling an employee their role is at risk before consultation, use our At Risk of Redundancy Letter first.

What's Included in Your Letter?

• The decision and reasons
  That the role is redundant and why.
• Consultation and alternatives
  The consultation held and any other roles considered.
• Notice and last day
  The notice period, whether it is worked or paid in lieu, and the last day.
• Redundancy pay and final pay
  The redundancy payment, pay up to the last day, holiday pay and other payments.
• Company property
  What must be returned and by when.
• Right of appeal
  How, to whom and by when the employee can appeal.
• Support and questions
  Who the employee can contact.

How to Write a Redundancy Letter

A redundancy letter confirms the outcome of a process, so it should be accurate, clear and kind. When you write one:

• Complete the process first
  Warn the employee that their role is at risk, consult with them, apply fair selection criteria and look for suitable alternative roles before deciding.
• Explain the business reason
  Say briefly why the role is no longer needed, such as reduced work, a restructure or a closure, so it is clear the decision is about the role.
• Record consultation and alternatives
  Summarise the meetings held and any other roles offered or considered.
• Set out notice and the last day
  State the notice period, whether it is worked or paid in lieu, and the last day of employment.
• Show how redundancy pay is worked out
  Give the amount, how it was calculated and when it will be paid, separately from other final pay.
• Offer support
  Mention any time off to look for work, help with finding a new job and who to contact with questions.
• Explain the appeal
  Say how to appeal, to whom and by when.

Common Mistakes to Avoid

The most serious mistake is deciding on redundancy before consulting. A letter sent on the same day as the first meeting suggests the outcome was fixed in advance. Choosing who goes using unclear criteria, or criteria linked to a protected characteristic such as age, sex, disability or pregnancy, can make a dismissal unlawful.

Mistakes with money are also common. Check the employee's length of service, weekly pay and age where the calculation uses them, and remember that notice pay and holiday pay are paid on top of redundancy pay. Redundancy pay the employee is already entitled to cannot be made conditional on signing a waiver; only an extra payment can be offered on that basis. Keep the tone respectful, avoid comments about the employee's performance and keep a copy of the letter. If you have not yet told the employee their role is at risk, start with an At Risk of Redundancy Letter.

How It Works on Robot Lawyer

1. Answer the questions
   Tell us about the employee, the reasons, consultation, notice and payments.
2. Generate your letter
   We draft a clear, respectful letter from your answers.
3. Get it verified
   On the Verified plan, a qualified legal professional checks your letter within 24 hours and makes amendments where needed. The Essentials plan does not include this check. See how our documents are verified.
4. Send it
   Download it, sign it and give it to the employee, and keep a copy.

What Your Document Looks Like

Your letter is a short, formal letter on your letterhead: the decision, the reasons, notice and last day, redundancy pay and final pay, company property, the right of appeal and who to contact, ending with a signature. Here is an extract from a sample letter we generated:

Redundancy pay and final pay

You will receive GBP 10,000.00 total redundancy pay, comprising GBP 5,616.00 statutory redundancy pay and an additional employer-funded enhanced redundancy payment of GBP 4,384.00. The enhancement is additional to, and does not replace, your statutory entitlement; it is not conditional on signing a settlement agreement.

The statutory calculation uses 9 complete years of continuous service from 1 September 2017, one week's pay for each complete year, and your actual gross weekly pay of GBP 624.00, which is below the applicable statutory weekly cap. You are aged 35 at dismissal and were aged over 22 throughout those complete years. A written statement showing how your statutory redundancy pay is calculated will be provided with the payment.

How It Works in Different Countries

• UK
  Employees with two years' service are usually entitled to statutory redundancy pay. Employers should consult before deciding, use fair selection, consider suitable alternative roles and offer a right of appeal. Larger redundancies have collective consultation rules. Redundancy pay and other termination payments are usually tax-free up to £30,000.
• United States
  Most employment is at will, so there is usually no legal right to redundancy pay unless a contract or policy gives one. Large layoffs may need advance notice under the federal WARN Act or state rules.

These notes are general. Check the current rules where the employee works.

Redundancy Letter FAQs

When should I send a redundancy letter?

After consultation has finished and the decision has been made. Your letter confirms the outcome.

How much redundancy pay is the employee due?

That depends on the law, their service and their contract. Your letter states the amount you give, or that it will be confirmed separately.

Does the employee have to work their notice?

Not always. Your letter says whether they will work their notice or be paid in lieu.

Can the employee appeal?

Offering an appeal is good practice. Your letter says how, to whom and by when.

Is redundancy pay taxable?

It depends on the law where the employee works. In many countries some or all of it is tax-free up to a limit, while salary, notice pay and holiday pay are taxed in the usual way.

Can an employee be made redundant while on leave?

Yes, but they must be consulted and treated fairly like anyone else, and in some countries employees on maternity or other family leave have extra protection.

Can I use this letter outside the UK?

Yes. Your letter is drafted under the law of the country or state you choose. Our lawyers are qualified in England and Wales and, on the Verified plan, check documents for good practice, clear formatting and the law of England and Wales. They are not qualified in other countries' law, so if your letter is governed by another country's law, we recommend having a local lawyer check it too.

Create a Redundancy Letter

Confirm a redundancy clearly and with care. You can start with a 7-day free trial. See our pricing for the plans. Related documents: At Risk of Redundancy Letter, Employment Termination Letter and Dismissal Letter.