Law/regulation around company moving offices?

[Scam]

My partner works at a big corporate with around 2,000 employees in their London office. There's probably hundreds of other offices around the world, definitely others in the UK too. For a while now there's been rumours that they're going to relocate the London office from one side of the city to the other. This would be hugely annoying for her as it'll more than double her commute time. Cost wise I don't think she'll lose out, but where they are currently is a slightly less 'corporate' area, whereas if the rumours are true they'll be with the suits and bankers amongst the skyscrapers. Grim

So for her it's a lifestyle change that'd suck. We live in London so it's just the time traipsing across the city that'll suck. For many of her colleagues that commute into London the cost and time difference are going to be massive though.

So what is the law around this? If the rumours are true and they do pull the trigger and move, what can her and her colleagues expect? A relocation bonus? A threat to sign a new contract or else be let go?

I'm sure the first question will be "what does her contract say" and to that it's the same as every other contract I've seen; "Your usual place of work will be XXXXX location with the need to work in another location from time to time". So nothing of use really.

TIA.

 

[Nasher]

Normally if it's not your primary place of work they need to cover travel expenses.

They may have a clause for a reasonable relocation. If not they will have to cover it afaik.

Or offer redundancy. But if they make redundancies they aren't allowed to hire replacements (if they do you can sue them).

 

[Ayahuasca]

They don’t have to provide a relocation bonus unless it is specified in the contract or company policy. They don't automatically have to compensate her for all additional travel costs, unless this is part of her contract or a company policy. They don’t automatically have to force her to move if the change is unreasonable and she refuses, though they may try to make her job redundant, but must follow proper redundancy procedures. They can’t simply dismiss people for refusing the new location unless they follow fair dismissal/redundancy law.

 

[Scam]

What is deemed 'unreasonable' though, and who decides? Her current offices are walkable from a mainline station, so a huge proportion of her colleagues travel in on that mainline. To then have to traipse across London on the tube for them would be at least an extra 30mins on their commute, not to mention the cost implications of adding on tube travel.

 

[Ayahuasca]

What is deemed 'unreasonable' though, and who decides?

The employer, if she and her colleagues are members of a union, or there's collective bargaining, there might be extra protections or negotiating power.

 

[Scam]

The employer, if she and her colleagues are members of a union, or there's collective bargaining, there might be extra protections or negotiating power.

So basically the employer would deem it “reasonable “ and nobody will have a leg the stand on?

What if an employer decided to move from London to Birmingham or something?

 

[Ayahuasca]

So basically the employer would deem it “reasonable “ and nobody will have a leg the stand on?

What if an employer decided to move from London to Birmingham or something?

They may, depending on how far they’re willing to push and how much resistance they face. If a move risks losing key staff, it becomes harder to enforce in practice, even if they technically have a mobility clause. A London to Birmingham relocation would usually go beyond what’s “reasonable” and could trigger legal issues such as redundancy rights or claims of constructive dismissal.

 

[slinxy]

I had this happen to me a good few years back.

There's no distance limit for office moves as long as it's with the same company.
Our's was more complexed as they wanted to give us new contracts to be inline with the staff that was already working there, in which case; I strongly suggested that they offer people redundancy as there was a fair few people that was already traveling over an hour to the current location, and the new location is 1.5 hours away from the current location and no matter what they did for those people; there would never be a reasonable ask.

I was one of them... after they spoke to the legal team; they offered redundancy to anyone who wanted it.

They just have to be reasonable with the office move, e.g. adjust work hours for a period of time for people to get used to it while they make changes to their other commitments etc.

 

[EvilRob]

Or offer redundancy. But if they make redundancies they aren't allowed to hire replacements (if they do you can sue them).

If they make her redundant because she can't commute to the new location and therefore hire someone based at the new location as a replacement, they'll be fine.

 

[Scam]

Sounds like as we thought - it is a massive grey area then.

I was one of them... after they spoke to the legal team; they offered redundancy to anyone who wanted it.

And how good was the deal? My partner would actually love to be made redundant, she’s been there for I think 14 years and their packages have been really quite good. But if they’re doing it en masse I’d imagine not?

 

[Jim99]

Redundancy pay isn't as good as it can sound at first https://www.gov.uk/redundancy-your-rights/redundancy-pay

Many companies go above and beyond this to avoid bad press, keep people onside, encourage people to leave without going down the formal redundancy route etc

 

[Lopéz]

Normally if it's not your primary place of work they need to cover travel expenses.


Or offer redundancy. But if they make redundancies they aren't allowed to hire replacements (if they do you can sue them).

That isn't what is being discussed here. The normal primary place of work is being changed - that's not the same as being asked to go to a different site. They will not need to cover any travel expenses.

Your comment about redundancy and hiring replacements is also not correct, they can absolutely do this.

Employer relocation: your rights

When employers move, employees with mobility clauses, what happens with redundancies, compensation, disputes and company takeovers

www.gov.uk

To be honest I don't think you'll get much recourse here @Scam , it's likely to be a case of like it or lump it but you never know, maybe the will over some form of compensation. Honestly though I would be surprised if they did.

 

[slinxy]

Sounds like as we thought - it is a massive grey area then.

And how good was the deal? My partner would actually love to be made redundant, she’s been there for I think 14 years and their packages have been really quite good. But if they’re doing it en masse I’d imagine not?

it really depends on the company... there was no financial issues with the company that I was leaving and I think only 8 of us actually took the redundantacy package.

We was given a month and a half salary per full year we was at the company. but statutory redundancy pay is much lower.

Redundancy: your rights

Being made redundant - rights, statutory payments you're entitled to, notice periods and consultation, finding a job.

www.gov.uk

That's the minimal legal requirement.. if you don't ask; you will never get; I did most of the negotiations for the redundancy package and the new contracts for the staff that was moving.
(yeah, some of the lads thought I would "do them over" with the new contracts, but they was pleasantly pleased.)

Hiring replacement after making people redundant is a moot point...
It's not the person that is made redundant but the position, when recruiting they can change the role so that it's consider a new role.. and location is a factor to a role.

Yeah they offer the person the role again, but if they didn't want to travel the distance in the first place; why would they accept the role now within 6 months and have to travel the same distance?

Legally the person do not have to give back statutory redundancy pay... but then legally; the company can offer a salary to that person that is much lower than they are offering to new employee and take in the fact that they had statutory redundancy pay.

The best case scenario is if the person was made redundant then come back as a contractor, I've seen this occur many times before as contractor pay comes out of a different budgets from full time staff.

 

[Quartz]

The best case scenario is if the person was made redundant then come back as a contractor, I've seen this occur many times before as contractor pay comes out of a different budgets from full time staff.

Things may have changed since my time but HMRC can take a very dim view of this.

 

[slinxy]

Things may have changed since my time but HMRC can take a very dim view of this.

why? they get a nice chuck of the redunancy package in taxes... then they will get a the taxes for the new job.
a lot of the time, the employee is employed by another (contract) compay. Even if they are within IR35, the tax office will get the taxes for the year.

 

[mid_gen]

why? they get a nice chuck of the redunancy package in taxes... then they will get a the taxes for the new job.
a lot of the time, the employee is employed by another (contract) compay. Even if they are within IR35, the tax office will get the taxes for the year.

A friend of mine was made redundant by large multinational a while back. He's just landed a new job with a different company within that multinational, and is having to pay back the redundancy (or at least a significant chunk of it).

 

[Nasher]

That isn't what is being discussed here. The normal primary place of work is being changed - that's not the same as being asked to go to a different site. They will not need to cover any travel expenses.

Your comment about redundancy and hiring replacements is also not correct, they can absolutely do this.

Employer relocation: your rights

When employers move, employees with mobility clauses, what happens with redundancies, compensation, disputes and company takeovers

www.gov.uk

To be honest I don't think you'll get much recourse here @Scam , it's likely to be a case of like it or lump it but you never know, maybe the will over some form of compensation. Honestly though I would be surprised if they did.

If they actually names the location in the contract it's going to be more complicated.

 

[b0rn2sk8]

I've beeen through this more than once.

A lot of what happens next depends on the company and what they are willing to offer but essentialyl it boils down to:

1) You move or,

2) you don't and you get made redundant.

It's pretty much that simple. What you'll get in both scenarios depends on both company policy and your contract - no one can advise you here and you need to look at your contract to see what it says.

They will have to set out a travel time as to what they see as being reasonble for you to move (unless a special circumstance applies e.g. disability, caring responsibility etc), where I worked, this was 60 mins for non-london and 90 mins for London (door to door). Assuming your contract is set up that you are 'mobile', if you fall within this time, you are moving unless you have an argument to show this would be unreasonble for you (as above). If you are contracted to a fixed location only, any move will be volentary but the same principle applies, either you move or you are made redundant.

Redudancy pay should be set out in your companies policy (or contract), they'll have to apply that as a minimum, they may offer more.

The firm may offer relocation expenses or a contribution towards higher travel costs for a period of time, this is taxable so just bare that in mind. Where I worked they offered to cover any additional travel expenses for 3 years and they grossed it up for tax so you were not out of pocket (just time) for 3 years as a transition.

 

[MissChief]

A friend of mine was made redundant by large multinational a while back. He's just landed a new job with a different company within that multinational, and is having to pay back the redundancy (or at least a significant chunk of it).

I’d be speaking to a solicitor for sure. His role was made redundant, not him, he just happened to be in it. If he’s been hired in a different role, by a different company then definitely speak to a specialist employment lawyer.

 

[b0rn2sk8]

I’d be speaking to a solicitor for sure. His role was made redundant, not him, he just happened to be in it. If he’s been hired in a different role, by a different company then definitely speak to a specialist employment lawyer.

The scenario you quoted is not abnormal and will be convered by the contractual terms under the redundancy.