EMPLOYERS facing difficult decisions as the Job Retention Scheme nears its end are being offered advice to help navigate the legislation.

Jessica Haunch, payroll director at Hentons in York, which has a specialist payroll team, has shed light on the finer details of redundancies to guide employers.

One key area to consider, she said, is the issue of termination payments which are made to employees in relation to the ending or loss of employment.

These can consist of various elements including redundancy pay, pay in lieu of notice (PILON), unpaid salary / overtime / bonuses / commission, holiday pay, and compensation payments.

Not all termination payments under £30k are exempt from tax and National Insurance, added Jessica.

For employees who have worked between one month and two years, the minimum notice period is one week. For those who have worked two years or more, the minimum period is one week per full year worked, up to 12 weeks.

Jessica said notice can be worked or not, and contractual notice may be the same or longer than statutory notice. Gardening leave is paid as normal until end of the notice period with no requirement to work. Meanwhile, for pay in lieu of notice/post employment notice pay, employees receive all notice pay at once and the job automatically ends.

There are two calculations to work out earnings subject to Tax and National Insurance which differ based on whether an employee is paid monthly or not.

Statutory redundancy is available to employees with at least two years of continuous service. It is not available if an employer offers suitable alternative work which is refused without good reason or in cases of being dismissed for misconduct.

Payments are based on employees' weekly pay, averaged over the 12 weeks prior to the trigger date.

The entitlement is also based on their age and length of service.

Maximum amounts that can be taking in to consideration are in place for weekly pay, total Statutory Redundancy and Length of Service.

You can no longer claim payments through CJRS for employees who are working their notice period and if an employee is earning less on furlough, their normal weekly wage must be used to calculate notice and redundancy payments.

For collective redundancies there are no limits on consultation periods, however minimum periods apply when 20 or more redundancies are being made.

Hentons has a specialist payroll team which can assist employers by navigating the appropriate legislation to ensure that all termination payments are compliant, assisting with calculations and offering expert advice on the best possible solutions for your business and employees.