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Law guide

Temporary lay-off

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Temporary lay-off

In certain circumstances, you might be temporarily laid off from your job. This article explains what this means and how you'll be paid when you're laid off. It also looks at your rights and your employer's responsibilities.

What is a lay-off?

If your employer doesn't have enough work for you, they may tell you to stay at home. If you're off work for at least one complete working day, this is a lay-off. Lay-off rights only apply to employees. For more information, see our 'Employees, workers and the self-employed' section.

A lay-off is temporary - if you're no longer needed to do your job, it's classed as redundancy.

Short-time

Your employer might have enough work to put you on short-time. This means your hours of work are cut.

Is your employer allowed to lay you off?

Your employer is normally entitled to tell you not to come into work as there is generally no legally enforceable right to work. However, there is an obligation for employers to pay employees their agreed salary. So usually your employer must pay you your full pay, unless you have agreed otherwise in your contract of employment.

There's no specific upper limit for how long you can be laid off or put on short-time, but it cannot continue for any period which is longer than what would be reasonable. Employees who only get paid for work they actually do have the right to leave and claim redundancy after a certain amount of time (see below). If your employer is being completely unreasonable in laying you off, you might consider resigning and claiming constructive dismissal. If you are put onto short-time working by your employer and your contract of employment does not give them the right to do this, they have broken your contract of employment and you may be entitled to treat the intention to place you on short-time working as constructive dismissal – that is to say as if you had been actively dismissed – and you may claim redundancy payments.

Situations where this might happen include:

  • If it seems they are laying people off indefinitely in order to avoid making people redundant
  • If they are unfairly singling you out
Are you paid while laid off?

You should get your full pay unless it is part of your contract that your employer can lay you off without pay (or on reduced pay). You should remember that something can be a part of your contract if:

  • It's written in your contract
  • You've verbally agreed it with your employer
  • It's in an agreement negotiated by a trade union
  • There's a national agreement for the industry
  • There's clear evidence that it's an established custom and practice
If it's not part of your contract, you can agree to change your contract if you wish (for example, a period of lay-off may be better for you than redundancy). If you agree to change your contract to allow unpaid lay-off, it is advisable to write down the agreement, making clear how long the agreement is going to last and whether you can change your mind.

If it's part of your contract that you can be laid off without pay, you'll have the right to Statutory Guarantee Pay (if you qualify). If it's not, you'll have the right to be paid the larger of:

  • What the contract provides for (which could be full pay or a reduced amount)
  • Statutory Guarantee Pay (if you qualify) (see below)
Contractual pay

Your contract may state that you'll be paid while laid off. It should tell you how much you'll get and how the rate has been agreed (for example, in a trade union agreement).

Statutory Guarantee Pay

To get Statutory Guarantee Pay, you must:

  • Have been employed continuously for at least one month - this includes part-time workers
  • Reasonably make sure you're available for work
  • Not refuse any reasonable alternative work, including work that isn't in your contract
  • Not have been laid off because of industrial action
Guarantee payments are made for a maximum of five days in any rolling period of three months. After that time you should get them for another five days. If you normally work fewer than five days a week, you're paid for the number of days in your normal working week.

Guarantee payments are worked out by multiplying the number of normal working hours for the day in question by your average hourly rate. You'll receive your daily rate or the upper limit of £25.00, whichever is less.

When Guarantee Pay has run out you should go to your Jobcentre to find out about benefits.

If your contract provides that you are entitled to be laid-off, but does not make any mention of payment during that period, then you are entitled to the statutory guarantee payments which are payable for complete days without work but not for any day when you worked for part of the day.

Applying for redundancy

Even if your employer is allowed to lay you off or put you on short-time, if it lasts long enough, you may be able to claim redundancy pay. However, this only applies if your wage depends on you being given work by your employer (e.g. you're a piece-rate worker). You have to follow a strict procedure:

  • In this case, 'laid off' means laid off for a whole week and short-time means earning less than half of your weekly wage
  • If you're laid off or on short-time for four or more weeks in a row or for a total of six or more weeks within a 13-week period, you may be entitled to redundancy pay
  • To get the pay you must give your employer written notice that you intend to claim redundancy and the reasons why – within four weeks of the end of the lay off period for which you're claiming
  • If your employer gives you a 'counter-notice' that, within four weeks, work lasting 13 weeks will be available, you won't get redundancy pay unless an Industrial Tribunal decides in your favour
  • If there's no counter-notice from your employer, you can resign and apply for redundancy pay
If you are unsure of how this process works, you should get advice.

What to do next

If your employer lays you off, check whether this is allowed under your contract or through custom. If you wish to agree to change your contract so that lay-off is allowed, you can do so. Another option open to you is to agree to take some annual leave instead of lay-off.

If lay-off is allowed, make sure your employer knows they should still give you Statutory Guarantee Pay. If it isn't allowed, you should get full pay (unless you agree to accept less).

If your employer lays you off without pay, and you feel they had no right to do this, or they fail to pay you Guarantee Pay, you can take the matter to an Industrial Tribunal.