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If your contract allows lay off or short-time working

This advice applies to Scotland

If your contract says your employer can lay you off or put you on short-time working, then they’re legally allowed to cut your hours and pay.

There’s no limit on how long your employer can lay you off or put you on short-time, unless your contract says there is.

You might be entitled to some money from your employer or to claim benefits while you’re laid off or on short-time working. You might also be able to use your holiday pay.

Check to see if you get ‘guarantee pay’

You should check your contract to see if you get ‘contractual guarantee pay’. This is money your employer will pay you each week while you’re laid off/on short-time working.

Even if you don’t get contractual guarantee pay, you might be able to get ‘statutory guarantee pay’ from your employer.

You need to have worked there for at least 1 month, and be earning less than half your normal pay.

You can only get statutory guarantee pay for 5 days in a 3-month period.

GOV.UK has more information on how much guarantee pay you might get.

Your employer should pay your guaranteed pay as they would your normal pay. 

Contact your nearest Citizens Advice if there's a problem with your pay.

Tax credits and other benefits

While you’re laid off or on short-time working, you might be able to claim some benefits, like Jobseeker’s Allowance or Working Tax Credits - check what benefits you can get on GOV.UK.

If you get Working Tax Credits already, you might be able to get a higher amount.

You should report any change to HM Revenue and Customs quickly, as any increase in tax credits can only be backdated for up to 1 month.

Redundancy pay

You can argue you've actually been made redundant if you’re earning less than half your normal pay and you've been laid off or put on short-time working for either:

  • 4 or more weeks in a row

  • a total of 6 weeks in any 13-week period

If you’re entitled to redundancy pay (for example, you've worked there for 2 years), you need to follow special rules to claim it. The process is complicated so contact your nearest Citizens Advice for help claiming your redundancy pay.

Doing other work while you’re laid off or on short-time working

Check if your contract says you can do other work while you’re laid off or on short-time working.

Even if your contract says you can do other work, you also have to ask your employer - it’s usually okay as long as you’re not working for a competitor.

You need to make sure you can return to your normal job as soon as your employer has work again. If you don't, your employer might say you’ve resigned and not pay you any redundancy pay you’re entitled to.

Contact your nearest Citizens Advice if you need help understanding your contract or negotiating with your employer.

Tax while you’re laid off or on short-time working

A drop in your income means you’ll pay less tax. You might even get a tax refund.

If you’re laid off and claim Jobseeker's Allowance or Income Support, you can claim a tax refund at the end of the tax year.

If you don’t claim benefits or you're not planning to work again that tax year, you can apply to HM Revenue and Customs for a tax refund 4 weeks after finishing work.

GOV.UK has more information on how to claim a tax refund.




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