Question

What is the difference between redundancy and dismissal?

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Answer

Redundancy is a dismissal for a specific reason: the job is no longer needed. Dismissal generally refers to termination for a reason relating to you — conduct, capability, or another substantial reason.

The distinction matters because the consequences differ sharply.

Redundancy arises in defined circumstances under UK law: the business closes, the workplace closes, or the requirement for employees to do work of a particular kind has diminished or ceased. The critical point is that the role is removed, not the person. If an employer makes someone redundant and then recruits for the same job, it was not a redundancy.

What redundancy entitles you to:

Statutory redundancy pay after two years' service, calculated from age, length of service and weekly pay up to a statutory cap. Many contracts offer enhanced terms.

A fair process, including meaningful consultation, objective and non-discriminatory selection criteria, and consideration of suitable alternative employment.

Collective consultation obligations if 20 or more roles are at risk at one establishment within 90 days.

Notice pay, and time off to look for work.

Dismissal for conduct or capability entitles you to notice (unless gross misconduct) but not redundancy pay, and requires a different fair process — investigation, a hearing, the right to be accompanied, and a right of appeal.

Unfair dismissal is the claim available if the reason was not one of the potentially fair reasons, or the process was inadequate. It currently requires two years' service.

Automatically unfair reasons need no qualifying period — pregnancy, trade union activity, whistleblowing, asserting a statutory right.

Constructive dismissal is when you resign because of a fundamental breach by the employer, and is treated as a dismissal.

Watch for sham redundancies used to remove an individual. General information on Great Britain only.

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