What happens if you're laid off (i.e. sent away from work temporarily because there is not enough work to do) will depend on your contract. If your contract does not give your employer the right to lay you off without pay, you should continue to receive your normal pay (or a reduced rate of pay provided for in the contract) whilst you are laid off.
If your employer wants to cut your pay, they will need your agreement. In practice, this kind of agreement is best negotiated collectively by a trade union. Talk to yours if you are a member of one.
Even if your employer does have the contractual right to lay you off without pay, you can still claim a statutory guarantee payment, as long as you have worked for your employer for at least one month. This is the minimum you should be paid if you are laid off.
The current rate for statutory guarantee pay is capped at £28 per day (from April 2018). Statutory guarantee pay is limited to five days in any three months. There is nothing to stop your employer agreeing to pay more than this. Often in unionised workplaces, better rates and arrangements will have been negotiated.
After you have used up any guarantee pay entitlement you may be entitled to social security benefits. In addition, if you have at least two years' service, you may be able to claim a redundancy payment. You can claim a redundancy payment if you are either:
- laid off (or on short time working for less than half a week), for four or more consecutive weeks, or
- laid off or on short time for six or more weeks in any 13-week period.
You have to give written notice to your employer of your intention to claim a redundancy payment. You must do this within four weeks of the last non-working day in the four or six week period. Your employer then has seven days in which to either accept your claim or to send you a notice (known as a “counter-notice”) objecting that no redundancy pay is due. Your employer should only send you a counter-notice if they expect the normal working week to restart within four weeks, and to last at least 13 weeks.
If the employer does not send a counter-notice, you can assume that the employer accepts that you are redundant. You will need to resign to claim a redundancy payment by giving your contractual notice. There are just three weeks in which to resign and claim a redundancy payment, so the timing of the resignation is very important. Speak to a union rep if you have one, or take advice from Citizens Advice.
Only by strictly following the statutory rules will someone who has been laid off be able to claim a redundancy payment.