Manufacturing trade union Amicus has attacked legislation to set a maximum week's redundancy pay.
The Redundancy Payments Act, which dates back to 1965, is indexed linked but limits statutory redundancy pay to £270 a week. Amicus claims manufacturing workers are losing out on thousands of pounds in redundancy pay, as the average manufacturing workers salary is £469.30.
The Act also sets a maximum payment of 30 weeks' pay after 20 years employment, which limits the level of compensation to £8,100. Workers who work for less than two years are not entitled to statutory redundancy pay.
Amicus insists the current system is unacceptable for employees who may be 60 and have as many as 45 years service with a company and the union is calling for the cap to be tied to the average worker's rate of pay, or set at workers actual rate of pay and linked to average rises in pay.
Derek Simpson, general secretary of Amicus, said: "The principle should be that people are paid according to their actual loss. This should serve to allow workers to be justly treated and to deter multinational employers from sacking British workers because it's cheaper and easier to make redundancies here than on the continent."
Amicus is campaigning for a level playing field with Europe on employment legislation and is also backing an Early Day Motion brought by David Crausby, Bolton North East for a reform of the redundancy rate formula.
A report by the House of Commons Select Committee on Trade and Industry considered the relative UK and European position on redundancy in January 2001 and concluded: "The suggestion that it is easier and cheaper to dispose of employees in the UK than elsewhere seems to us to have been shown to be factually correct." |
