Withdrawal of redundancy acceptance and moving company

richmond · #1 26-04-09, 07:07 PM

I have been accepted for voluntary redundancy from my company and, on the strength of that, then accepted the offer of a one year contract from another division within the company. They are different P&L centres, trading under different names with different management teams.
Now that I have accepted the new contract, my employer claims I am ineligible for the redundancy payout. I have two questions. 1. Is this the case? and 2. would taking the redundancy money leave me with a tax liability?

Peter Etherington · #2 08-05-09, 04:56 PM

You may have a breach of contract claim if your employer refuses to pay out on the VR but that depends on what has actually been agreed. Of course, if it has all been verbal you will struggle with proof.

I can't advise on tax but I expect there would be a problem - in effect you have taken an alternative position with the company (or an associated company) instead of redundancy. If your employer had been a bit cuter about this they could have offered that role to you as an alternative to redundancy in the first place (I certainly would have advised them to do so).

I suspect you will need to give up the VR but you will retain your continuous service and will be eligible for redundancy at the end of the year (assuming there is no other role then)