Do we have to pay back pay to those who have left our employment?
It is likely that there is no legal obligation for you to do so as no contract of employment continues to exist between you and the ex-employee. However, many councils will make a payment to those ex-employees who submit a written request for payment. We are aware that a few councils do automatically calculate and pay back pay for all leavers while the majority wait for a formal request to be made by individuals.
What is the timeframe for making a claim for back pay?
Ex-employees might attempt to bring a tribunal claim for either breach of contract or unlawful deduction from wages. The time limits for bringing such claims is 3 months from the last incident. Tribunals may accept that the employee could not have known the deduction existed until the pay award was agreed, therefore, the 3 months could be considered to start from 28 February 2022.
Can those who were made redundant submit a claim for back pay?
Yes, in the same way that anyone who has left your employment, an employee dismissed on grounds of redundancy would be able to submit a claim for back pay.
Do we have to recalculate the redundancy pay of an ex-employee?
There is no legal obligation to recalculate the redundancy pay of those employees you have dismissed on the grounds of redundancy. In Leyland Vehicles v Reston (EAT) 1981 the EAT determined that the wording of the Employment Rights Act relating to the calculation of a week’s pay is based on the pay that is contractually in place at the time of the calculation. Therefore, unless there is specific wording in contracts that places an obligation on employers to recalculate once a pay award is agreed, the rate of pay in place at the time of the calculation date is the correct rate i.e. the pre-award rate. Of course, you can exercise local discretion, under The Local Government (Early Termination of Employment) (Discretionary Compensation) (England and Wales) Regulations 2006, to recalculate the redundancy pay but your policies should set out how you will apply the discretions and the limits. We recommend seeking legal advice before exercising such discretions.