In Allsop v North Tyneside Metropolitan Borough Council [1992] 90 LGR 462 CA, the Court of Appeal held that payments made to employees by a local authority as compensation for redundancy under a voluntary severance scheme were unlawful as they exceeded the prescribed limits.
In Ross v Delrosa Caterers Ltd [1981] ICR 393 EAT, the Employment Appeal Tribunal held that, although continuity of employment is broken where a redundancy payment has been paid to an employee and the contract of employment is renewed or the employee re-engaged under a new contract, this is the case only if the redundancy payment is a statutory redundancy payment.
In Rowan v Machinery Installations (South Wales) Ltd [1981] IRLR 122 EAT, the EAT held that the Industrial Tribunal had erred in finding that the appellant's period of continuous employment had been broken when his contract of employment had been terminated by the respondents and he was paid an amount calculated in accordance with the statutory redundancy payment provisions, in circumstances in which there was no liability on the respondents to make a redundancy payment.