Letter seeking agreement to a lay-off or short time working

If you want to implement a lay-off or short time working to deal with a temporary work shortage and you don’t have the contractual right to do so, you will need to seek your employees’ express agreement to the proposed arrangement or otherwise you risk a constructive dismissal claim if you impose it unilaterally.

No contractual right

Where you have no contractual right to lay-off the employee or put them on short time working, you cannot just impose such an arrangement on them, however dire or pressing your current financial circumstances may be. The employee’s express consent is needed. The employee should first be made fully aware what they are consenting to, so it’s important to consult properly with them. Use our Letter Seeking Agreement to a Lay-Off or Short Time Working - it covers all the matters that need explaining to the employee so there can be no misunderstandings about what the position is. Have a meeting with your affected employees first because it is much better to start by explaining sensitive situations such as these verbally. Once you have consent, if your economic situation doesn’t improve and the lay-off or short-time working looks set to continue for longer than you thought, seek your employee’s agreement again because otherwise they might argue they only consented on the basis of an assumption that the lay-off or short time would last for a certain number of weeks or until a set date, not longer. There will come a point in time when you will need to consider implementing a redundancy programme if things still haven’t improved as a lay-off or short time working is only intended to provide a temporary solution.

Constructive dismissal

If the employee’s consent is not obtained to a lay-off or short time working but you impose it on them anyway, you will be in fundamental breach of their contract of employment regardless of your financial situation and they may claim they have been constructively unfairly dismissed if they subsequently resign as a result of your actions and they have sufficient continuity of employment. An employee can generally claim constructive dismissal if they have been employed for two years or more.

Guarantee payments

We’ve covered all of this in the introduction to our Letter Imposing a Lay-Off or Short Time Working (in Exercise of a Specific Contractual Power) so simply refer back to those.