Redundancy and Benefits

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Benefits

Some benefits are means tested. This means that for some benefits, the government will look at how much money you have coming in or as savings before deciding whether you are entitled. Your redundancy lump sum will count as savings and could reduce the amount of benefit you are entitled to.

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Voluntary Redundancy

Voluntary redundancy does not affect your entitlement to benefits. Even if you chose voluntary redundancy, it is still a dismissal in law and so there should not be a barrier to you claiming JSA.  Knowing this, it is a good idea not to state that your redundancy was “voluntary” since this may cause confusion.

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Alternative Employment

Your employer must offer you alternative employment if this is available. If you reject the offer of alternative employment because it is unsuitable, this should not affect your entitlement to benefits.

You are entitled to a minimum four week trial period of the alternative employment. If you leave during the trial period, you will still be considered redundant, and therefore entitled to benefits.

If you refuse alternative employment which your employer considers suitable, you may lose your entitlement to redundancy pay and benefits. In such a situation you can make a claim to the Employment Tribunal. If you produce evidence to the Job Center that the matter is being decided by the Employment Tribunal, this should reinstate your entitlement to benefits whilst your case is pending in the Employment Tribunal.