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Redundancy Payment In Lieu Of Notice Rules?


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can someone clear up the law regarding payment in lieu of notice.

 

I thought that as i am a manx worker the company has to follow the manx law as a minimum and in the manx law it states companys have to give or pay 1 weeks notice for every year worked.

For me that is 12 weeks. But whenever notice is being mentioned at work they always say 1 months notice. Which is what it says in my contract.

 

Is my contract a minimum .. or does the contract overrule the manx law?

 

Thanks in advance.

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May not apply here, but when I received redundancy pay in the UK, as it was in lieu of notice it was tax free, I don't suppose it's that important over here with the tax being so low, but over there it was a very nice bonus. :D

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May not apply here, but when I received redundancy pay in the UK, as it was in lieu of notice it was tax free, I don't suppose it's that important over here with the tax being so low, but over there it was a very nice bonus. :D

I was made redundant a few months ago in the UK. The payment was split into various parts. Firstly my experience was completely different from Grant's above. The PILON part was taxable and I also paid NI on the whole PILON amount. Secondly the first £30K of the redundancy bit was tax free. The rest was taxed at 22% (the nominal UK rate) and I now have to fight it out with Gordon Brown come next April. Or Ed Balls if Gordon is then running the whole show - can't wait for tabloid headlines a la "Balls to the Treasury" etc etc. Payments into the Pension Fund and amounts taken out of the Pension Fund on were free of tax. So you can put a tax free wedge into the fund and if the trustees agree you can take a (capped) amount out at a later date. This means that in theory currently you could put all of your monthly salary tax free into the pension fund on Friday and take it out again tax free the following Monday. Apparently it's happening as well.

 

However by law they only have to give you the statutory minimum and that's it.

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Pilon is seperate to your redundancy money tho isnt it?

 

According to people at work.. the company is applying the uk law for the redundancy.. which comes out at more than the manx law. so thats that minimum covered

But on the pilon. Im not sure whats going on.

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As far as I can recall, there is a difference between redundancy compensation and notice. The first is compensation for losing your job (and the statutory limit, I think, is one week for every year worked up to 12 years) and the second is the notice that must be given, even on being made redundant and is a contractual right. So if you are made redundant when your employer is still trading, you are entitled, as a minimum, your contractual notice period, which may be worked or paid in lieu, plus your statutory redundancy entitlement. This latter may be enhanced under your contract. Also, the rules regarding payment in lieu of notice periods may be different if your employer has gone bust.

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