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Constructive Dismissal/Settlement Offer - been told that trying to negotiate a better offer may result in withdrawal

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Last Wednesday, completely out of the blue I was called to a meeting at my HO and told that due to restructuring my job is at risk, the company produced a settlement offer and has given me a week to think about it (unlike 10 days as in ACAS guidelines)

 

They refuse to announce the nature of the restructuring, just that I don't fit within it and if I decline the offer then I have been told in no uncertain terms that I will be made redundant and end up with less money than they are offering.

 

Although I don't know (and probably never will) I am almost certain based on noises from the past few months that the restructuring involves paying off half the people that do my job, and then replacing the job of the remaining people with a new one with a bigger remit to cover the loss of those of us that are gone, and they are doing this entirely arbitrarily without any due process or allowing me to reapply for the new job. Given that there are already a small number of people doing this bigger remit job, and they have always said I would be suitable to do this if the opportunity gave up, I believe I am being constructively dismissed, and they are relying on the fact that I won't be able to claim that if I accept the offer.

 

A few hours after the meeting I sent an email to the people that were in the meeting (my line manager and her line manager) asking firstly for an extension of time to consider the offer, secondly for a fuller explanation as to what is going on and why I won't fit into the restructure, and thirdly asking if they will revise the sum offered. I did stress that I had not made any decisions and nothing in the email was intended to constitute a decision or limit my options.

 

That evening I got an off the record phone call from my line manager stating that I shouldn't have done that, I should have just taken the money and because I am seen to be arguing with them they might now just withdraw the offer and make me redundant.

 

Can they do that? I thought if the offer is open then it remains open until the window closes or I accept/decline it. Negotiation and asking for an explanation is surely not declining it? I also don't think they would be that stupid, because if I stay I will get to see what they are doing and retain all my employment rights including the right to take them to a tribunal.

 

I ask because I have now been offered another (better) job and if they want me gone I'm just happy to take the money at this point!

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The offer can be withdrawn at any time before you accept it – as long as they make the withdrawal of the offer known to you.

 

Also, if you come back to them and try to negotiate a different deal then that can be taken to be a rejection of their offer in which case you would not be able to accept the original offer unless they made it again.

 

The rules I'm using here are the rules of offer and acceptance in ordinary contracts – but I expect that exactly the same rules apply to employment contracts as well. Someone with better knowledge than me will properly come along and either confirm what I say – or put me right.


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OK, coming at this from another angle then. My email was sent to them on friday afternoon and I have not yet got any reply therefore the offer has not been withdrawn. So presumably if I send an email now stating that I accept the offer then I've accepted it because they haven't withdrawn it?

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BF is correct. Any offer can be withdrawn at any time before you agree to accept it. Circumstances change on both sides. I doubt very much whether your requests will constitute being awkward or difficult - they are perfectly reasonable, and as you are still within the week that was offered to consider the proposal then I would imagine that it stands as offered.

 

If they were to withdraw the offer, then the alternative could well prove even more expensive for them, irrespective of what is paid in redundancy, as without some back-tracking they could be looking at unfair dismissal through a flawed redundancy process.

 

If you are happy to accept, then put your acceptance in writing, stating that having considered their offer over the weekend, you are prepared to accept subject to the terms discussed. You will probably have to sign an agreement to indemnify against any possible legal action in the future.


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"produced a settlement offer and has given me a week to think about it"

 

Does that not mean that the offer will remain open for a week?

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how many people are involved in this restructure? If a dozen then they have to have a consultation period of at least a month and thus the threats about withdrawing the offer if you question it is merely a shield to prevent the questioning of the legality of their procedures. Read up on redundancy procedures and use that knowledge to assess your own situation as it may be a lot stronger than they make it out to be.

Also, is there a company pension scheme? If so then the pension trustees also have an interest that could be in your favour as it may be that the company will be forced to top up the pensions of those made redundant (but not those accepting the severance) That could well cost the C a damned sight more than any settlement they are willing to offer at present and thus want to avoid redundancy rather than really threaten it.

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Your acceptance of their offer won't be legally valid unless a settlement agreement is signed. Either party can withdraw up until that point, although it would be bad form if no counter offer was made.

 

You need to remember that this isn't an open negotiation - it's likely to be a without prejudice or S111A ERA negotiation and in either case, you'd never be able to go to court to argue that a contract was formed as any such discussions would be inadmissible.

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how many people are involved in this restructure? If a dozen then they have to have a consultation period of at least a month and thus the threats about withdrawing the offer if you question it is merely a shield to prevent the questioning of the legality of their procedures. Read up on redundancy procedures and use that knowledge to assess your own situation as it may be a lot stronger than they make it out to be.

Also, is there a company pension scheme? If so then the pension trustees also have an interest that could be in your favour as it may be that the company will be forced to top up the pensions of those made redundant (but not those accepting the severance) That could well cost the C a damned sight more than any settlement they are willing to offer at present and thus want to avoid redundancy rather than really threaten it.

 

I don't know - they won't tell me anything about the restructure, only that there is one and my job is at risk. It could only be me. In reality, if I'm right about my suspicions it will affect somewhere between 75-100 people. There is a company pension scheme which I pay into - nothing mentioned about what will happen with that.

 

You need to remember that this isn't an open negotiation - it's likely to be a without prejudice or S111A ERA negotiation and in either case, you'd never be able to go to court to argue that a contract was formed as any such discussions would be inadmissible.

I'm thinking more though that if I don't leave by mutual consent and end up being made redundant then I have a good constructive dismissal claim as if I am right about how they will restructure the company it appears obvious this would be a sham redundancy consultation about which the outcome has already been decided and with future people effectively already appointed before I've left.

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"I ask because I have now been offered another (better) job and if they want me gone I'm just happy to take the money at this point!"

 

So take the money and go with everyone happy. Just make sure the new job is secure and the agreement is secure.

 

Is this not more important than arguing about the fact that the firm has not handled the redundancy correctly, which obviously it hasn't?

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It would only be a constructive dismissal scenario if your job role was changed. If you're made redundant, you'd be looking at unfair dismissal.

 

The problem is that even if your dismissal is procedurally unfair, your employer wouldn't usually have to justify its decision to restructure - it is usually accepted that unless the decision was perverse, the reason for the dismissal would be fair. So any compensation recovered would usually be limited to the amount of time it would have taken to fairly dismiss you (think around a month). You could argue that you should have been placed into the role automatically though!

 

It's worth thinking about when you're negotiating your settlement agreement.

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If you are redundant then they company may have to apy a sack of money into the pension scheme so get a copy of the rules and see what it says about topping up pensions of members who are made redundant. the point of this is although it will only gain you about a month's salary extra becasue they havent obeyed the law on redundancy and dismissal it will cost them an absolute mint to pay the pension contributions of the improperly treated people (assuming standard pension rules) and therfore it would be worth paying you a decent severance package to avoid having to pay a fortune into the scheme ( probably around 1.5 years salary for someone aged 50) plus the statutory redundancy, holiday, notice pay etc

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