When is an employer entitled to pay compensation in the case of redundancy?

Prepare for the ACCA F1 Certification Exam with detailed quizzes featuring multiple choice questions and explanations. Enhance your understanding and ensure success in your exam!

An employer is entitled to pay compensation in the case of redundancy primarily when the owner decides to close the company completely. This situation signifies that the worker's position has been made redundant due to the cessation of operations, which meets the criteria for redundancy compensation.

Redundancy compensation is typically triggered when an employee's role is no longer necessary due to operational changes, such as a company closure, technological advancements, or restructuring. Under such circumstances, the law usually requires employers to provide a severance package to support the affected employees.

The other scenarios provided do not align with the standard grounds for entitlement to redundancy compensation. For instance, if a suitable transfer is offered and the employee declines, this may not qualify as redundancy since the job still exists in another format. Worker conduct leading to dismissal without notice pertains to disciplinary matters rather than redundancy. Finally, redundancy regulations may exempt certain workers, such as those who are pensionable age or who have less than two years of continuous employment, from receiving compensation in specific jurisdictions.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy