Do layoff periods have to be reasonable?

Bray & Bray
Ian Lewis

Ian Lewis, senior consultant in company commercial law and employment law at Bray & Bray, explains the ins and outs of layoff periods.

What is a layoff period?

A layoff period is where an employer can ask an employee not to come into work, or to take unpaid leave, if there isn’t enough work for an employee to do.

How long can employees be laid off for?

Layoff periods have no limits. However, employees can apply for redundancy if they have been laid off for four weeks in a row, or six weeks over a thirteen week period.

Recent example

The Employment Appeal Tribunal (EAT) held than an employee who resigned after being laid off for around five weeks without pay had not been constructively unfairly dismissed. In this case, there had been a genuine downturn in work, which led to the employer operating the contractual layoff clause.

The employer legitimately followed the statutory scheme, under which a redundancy payment does not have to be paid if there is a reasonable expectation that further work will become available within four weeks.

So what is reasonable?

The EAT held that there is no implied term of reasonableness in a contractual provision allowing employees to be laid off, or put on short-time working for an indefinite period without pay.

Questions about layoff periods

Whether you are an employer or an employee dealing with layoff periods, if you would like to check if what is in place is fair and correct, you can email me with any questions that you may have directly at idlewis@braybray.co.uk