Redundancy pay & leaving during a notice period
When an employee is made redundant, they also get a notice period. An employer can either:
- pay the notice period, or
- let the employee work through their notice period.
What happens if the employee leaves during the notice period?
They might not get redundancy pay. This depends on whether the employee is covered by an award or registered agreement.
Award and agreement covered
Most awards say that if an employee is made redundant and leaves during their notice period, they still get redundancy pay. An agreement can say the same.
Not covered by an award or agreement
An employee who isn’t covered by an award or agreement, that resigns during their notice period won’t get redundancy pay.
If they're told by their employer to leave during their notice period, they still get redundancy pay.
Fair Work Act 2009 - section 119 says that employees get redundancy pay if they're leaving at the employer’s initiative. If the employee resigns, they aren’t leaving at the employer’s initiative.
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