Navigating Redundancy During Pregnancy & Maternity Leave

Redundancy is one of the most challenging processes for any business to manage. It involves difficult decisions that affect people’s livelihoods. The complexity increases significantly when the redundancy situation consists of an employee who is pregnant or on maternity leave. For employers, it’s a legal minefield. For employees, it’s a period of immense uncertainty.

Navigating the intersection of maternity leave and redundancy requires a thorough understanding of an employer’s legal obligations and an employee’s enhanced rights. The law provides specific protections to safeguard expectant and new mothers from unfair treatment during workforce restructuring. Failing to adhere to these rules can lead to claims of automatic unfair dismissal and discrimination.  This often leads to expensive lawsuits and a damaged reputation.

This article will guide you through the essential legal framework governing redundancy rights during maternity leave and when pregnant. We will examine the key regulations, the significant new legal protections introduced in April 2024, and how recent case law has shaped the practical application of these rights. Whether you are an HR professional managing a redundancy process or an employee facing a potential redundancy situation, this guide provides the clarity you need.

The Foundation of Redundancy Protection

The core protections for employees on maternity leave during redundancy are outlined in the Maternity and Parental Leave etc. Regulations 1999 (SI 1999/3312). Two rules are fundamental.

Regulation 10: The Right to a Suitable Alternative Vacancy

Regulation 10 provides a powerful right for an employee on maternity leave. If her role becomes redundant, she is entitled to be offered any suitable alternative vacancy ahead of other employees. This constitutes a rare instance of lawful positive discrimination.

The key elements are:

• A “suitable alternative vacancy” must exist. This means a job that is appropriate for the employee to do in the circumstances.
• The terms and conditions of the new role must not be substantially less favourable than those of her previous job.
• The employee on maternity leave has priority over other redundant employees who might also be qualified for the role.

This regulation places a proactive duty on the employer. It’s not enough to invite the employee to apply for vacancies; the employer must make a direct offer of any suitable alternative role.

Regulation 20: Automatic Unfair Dismissal

To give Regulation 10 teeth, Regulation 20 states that if an employer dismisses an employee on maternity leave without offering her a suitable alternative vacancy (when one exists), the dismissal is automatically unfair.   It is also automatically unfair if an employer selects a woman on maternity leave for redundancy from a pool of employees where the principal reason for her selection is connected to her pregnancy, birth or maternity leave.

This removes the need for the employee to have two years of service to bring an unfair dismissal claim, significantly lowering the barrier to legal action. It underscores the seriousness with which the law treats maternity leave redundancy rights.

A New Era of Protection: The April 2024 Changes

While the 1999 Regulations provided a safety net, a gap existed. The enhanced protection under Regulation 10 applied only to employees already on maternity leave, leaving those who were pregnant but still working vulnerable.

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023, which came into force in April 2024, has fundamentally changed the landscape. It introduces an expanded “protected period” for redundancy protection for pregnancy and family leave.

What is the new “Protected Period”?

The special protection, which gives priority to suitable alternative vacancies, now applies for a much longer timeframe. This protected period begins when an employee informs their employer that they are pregnant and extends for 18 months after the child’s birth.

This significant extension means that an employee who announces her pregnancy at 12 weeks and takes a full year of maternity leave will be protected for approximately 2 years. This change provides far greater job security for new parents during a critical time. It ensures their redundancy rights are robust when pregnant and new parents.

Employers must now be acutely aware of this extended timeframe when planning any restructuring. The pool of employees with priority rights in a redundancy situation has expanded, requiring more diligent management of vacancies. This also impacts considerations around redundancy and statutory maternity pay, as a lawful redundancy can end SMP entitlement. Still, an unfair one will likely result in compensation covering that loss.

The Limits of Protection: Carnival PLC v Hunter

The strengthened legal framework, however, does not provide a guarantee against redundancy. A crucial clarification on the limits of Regulation 10 came from the Employment Appeal Tribunal (EAT) in the case of Carnival PLC v Hunter.

The Facts of the Case

Mrs Hunter was a team leader at Carnival, the cruise operator. The company underwent a restructuring, reducing the number of team leader from 21 to 16. Mrs Hunter, who was on maternity leave, was made redundant after a selection process. She argued that under Regulation 10, she should have been offered one of the remaining team leader roles.

The EAT’s Decision

The EAT disagreed. It clarified that Regulation 10 is triggered only when a suitable alternative vacancy exists. In this situation, there was no “vacancy.” The company was reducing the number of existing roles and the successful colleagues kept their existing roles.

The EAT emphasised that Regulation 10 does not give an employee on maternity leave the right to “bump” another employee out of their job. It only provides the right of priority to be offered a new, vacant position. Had there been a different, newly created role available as part of the restructure, Mrs Hunter would have been entitled to be offered it first. But she was not automatically entitled to one of the remaining roles which her colleagues already filled.

This ruling is vital for HR professionals and business owners to understand. It confirms that employees with redundancy protection for pregnancy or maternity leave can still be placed in a selection pool and lawfully made redundant if they are fairly selected and no suitable alternative vacancy exists.

Practical Steps for Employers

To navigate this complex area and minimise legal risk, employers should follow a transparent and fair redundancy process:

1. Identify the Protected Period: As soon as an employee notifies you of her pregnancy, log the start of her protected period. Ensure your HR systems track this 18-month post-birth window.
2. Fair Selection: Ensure any selection criteria for redundancy are objective, transparent, and non-discriminatory. A criterion like “attendance,” for example, could indirectly discriminate against an employee who has been absent for pregnancy-related illness or maternity leave.
3. Proactively Search for Vacancies: If an employee in a protected period is at risk of redundancy, the onus is on the employer to actively search for a suitable alternative vacancy across the entire business. This is not a passive exercise.
4. Make a Formal Offer: If a suitable role is identified, it must be formally offered to the employee. Do not just invite her to apply. Document this offer clearly.
5. Consult Meaningfully: Keep the employee informed and engaged throughout the consultation process, even if she is on maternity leave. Ensure she has a genuine opportunity to contribute.

Navigating Your Rights and Responsibilities

The laws surrounding maternity leave and redundancy are designed to provide crucial protection during a vulnerable time. The recent expansion of the protected period has significantly strengthened these safeguards.

However, as cases like Carnival PLC v Hunter show, these rights are not absolute. The process remains nuanced, and outcomes often depend on the specific facts of the redundancy situation.

Whether you are an employer aiming for compliant and compassionate restructuring or an employee concerned about your job security, expert legal advice is invaluable. The team at Jones Chase Employment Lawyers has a wealth of experience guiding clients through every aspect of employment law, from navigating redundancy processes to representing claimants in unfair dismissal and discrimination cases. We are passionate about achieving the best possible results.

If you are facing a redundancy situation involving pregnancy or maternity leave, don’t navigate it alone. Schedule a consultation today to ensure you are fully informed of your rights and obligations.

Jones Chase is a specialist employment law firm based in London with an excellent track record of looking after our clients, both employers and employees. Learn about our client reviews here.