Many employers observe good practice by offering enhanced redundancy payments to employees dismissed for redundancy.
There is specific statutory provision for employers that wish to make enhanced redundancy payments, with three options, including removing the statutory cap on a week's pay in the calculation, set out in the legislation. Any other enhanced redundancy payment scheme will be unlawful unless objectively justified.
To avoid enhanced redundancy payments becoming contractual, the employer should make it clear that such payments are discretionary.
