New law gives greater protection to pregnant women and new parents facing redundancy

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 extends priority status in redundancy situations to pregnant employees and to those who have recently returned from maternity, adoption or shared parental leave, according to Which?¹. The change takes effect from April 2024¹.

Under the rules in place before the change, employers had to offer a suitable alternative vacancy, where one existed, to employees on maternity leave, shared parental leave or adoption leave before offering them redundancy¹. The 2023 Act extends that priority status to pregnant employees and to those who have recently returned from maternity or adoption leave and shared parental leave¹.

The change comes against a rising redundancy rate. The UK redundancy rate rose to 4.6 per thousand people in the three months to January 2024, the highest since 2021, according to Office for National Statistics data cited by Which?¹. Between November 2023 and January 2024 there were around 133,000 redundancies in the UK, compared with 116,000 in the previous three months¹. The unemployment rate also climbed in the three months to January 2024, to 3.9%, and is expected to hit 4.5% by the end of the year¹.

Separately, statutory redundancy pay limits change in April. For redundancies in England, Scotland and Wales on or after 6 April 2023, weekly pay was capped at £643; this rises to £700 from 6 April 2024¹. The maximum amount of statutory redundancy pay is capped at £19,290¹. Statutory redundancy pay is worked out on length of service, up to a maximum of 20 years, and age¹:

Everyone who has been with a business for two or more years is usually entitled to statutory redundancy pay¹. In some instances, for example refusing suitable alternative work without a valid reason, an employee will not be eligible¹. Employers should pay redundancy on the date the employee leaves the company or on the next normal pay date¹.

On procedure, Which? reports that an employer that does not follow the procedures required by employment law, where the employee has worked there for more than two years, may have the dismissal deemed unfair¹. Employers must consult trade unions or staff representatives if more than 20 redundancies are proposed within a period of 90 days¹. An employee dismissed with the requisite two years' service has three months less one day from the date employment ends in which to issue a claim, and must contact the conciliation service Acas to commence Early Conciliation before issuing a claim¹.

Why it matters for households

For pregnant employees and those recently back from maternity, adoption or shared parental leave, the practical effect is that where a suitable alternative vacancy exists, it must be offered to them ahead of other employees being considered for redundancy¹. That protection previously applied only to employees still on maternity, shared parental leave or adoption leave¹.

For anyone made redundant on or after 6 April 2024, the weekly pay used to calculate statutory redundancy pay is capped at £700 rather than £643, and the overall statutory redundancy pay maximum is £19,290¹. Notice periods, where statutory minimums apply in England, Wales and Scotland, run from at least one week for between one month and two years' service, to a week for each year between two and 12 years, and 12 weeks for 12 years or more¹. Unless a contract says otherwise, payment in lieu of notice is unlikely to include the monetary equivalent of benefits such as pension contributions that would have been received during the notice period¹.

What happens next

The extended priority status applies from April 2024¹. The higher weekly pay cap of £700 and the £19,290 maximum apply to redundancies on or after 6 April 2024¹. Further detail on how the extended protection will operate in practice has not been reported. Households facing redundancy can find related guidance in Losing Your Job: Redundancy Pay, Benefits and Budgeting, part of the life events hub.