Redundancy Pay

person holding pencil near laptop computer
Type: Vocabulary
Originally published on October 28, 2020 and last updated on February 4, 2023

Employing people is an important step for many small businesses. It is often a huge decision as it adds additional costs and responsibilities to the business. In addition to the responsibility of paying the employee every month, having employees can also be particularly challenging when the company is struggling and needs to reduce its overheads. In that situation, it may no longer be able to afford an employee and as a result, will make that employee redundant.

The problem these businesses face is that in most countries when you make an employee redundant you are usually forced to pay them compensation, resulting in more expense for the business in bad times. Although this compensation certainly will help the employee, it can mean that the business itself will no longer survive.

Go through the vocabulary below with your students and ask them to try and use this vocabaulry where possible when discussing the different conversation questions.

Useful Vocabulary

Try and use the following vocabulary when answering the question. Click to look up the definition in the dictionary

  • employee (noun)
  • redundant (adjective)
  • force (verb)
  • compensation (noun)
  • expense (noun)
  • challenging (adjective)
  • struggling (adjective)
  • result in (phrasal verb)
  • survive (verb)

Conversation Questions

  • Should businesses have to pay compensation when making employees redundant?
  • Have you ever been made redundant? If yes, did you receive compensation?
  • Why do you think the law forces business to pay compensation to employees that are made redundant?
  • What are the benefits of not forcing business to pay employees compensation?
  • What do you think can be done to help small businesses who need to cut back on staff costs?
  • Overall, do you think businesses should have to pay compensation when making employees redundant?
This conversation topic was prepared by Gregory

Gregory is a qualified TEFL teacher who has been teaching English as a Foreign Language (ESL) for over a decade. He has taught in-person classes in Spain and to English learners around the world online.