Layoff vs. Redundancy — What's the Difference?
By Tayyaba Rehman — Updated on November 6, 2023
Layoff is a temporary suspension or permanent termination of employment initiated by the employer, while redundancy is the state of being no longer needed due to job positions being eliminated.
Difference Between Layoff and Redundancy
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Layoff and redundancy are both terms used in employment that relate to job cessation, but their contexts differ. Layoff is often a temporary situation where employees are expected to return to work once conditions improve, whereas redundancy is a form of permanent job elimination due to the role being no longer required, often resulting from company restructuring or downsizing.
In the context of business decisions, a layoff can be a strategic move to cut costs in response to reduced business activity or economic downturns. Redundancy, on the other hand, typically occurs when a position or a number of positions are no longer necessary, often due to technological changes, mergers, or shifts in market demand.
Employees who are laid off may be given the opportunity to be rehired or may receive temporary financial support from the employer or government. Redundancy often comes with a more formal severance or redundancy pay, and there is usually no expectation of the position being restored or the employees being rehired.
Layoffs can be of various scales, affecting a handful to thousands of employees, and may include a variety of positions. Redundancy, while it can also occur on a large scale, is specific to roles that have become obsolete, and it is a term more commonly used in British English, reflecting the permanent nature of the job loss.
Temporary or indefinite
Business downturn, economic reasons
Position elimination, not personal performance
Possible when situation improves
Unlikely as the role is obsolete
May or may not include severance pay
Typically includes redundancy pay
More common in American English
More common in British English
Compare with Definitions
A temporary unpaid leave from a job.
Workers faced a layoff until the factory orders picked up.
Elimination of employment due to role obsolescence.
The merger led to redundancy for many in duplicated positions.
A period during which an employee is not working but is still officially employed.
He used the layoff to improve his professional skills.
A situation where a position is no longer required, and the employee is let go.
She received a redundancy package after the company downsized.
An employer's act of suspending or terminating workers.
The new CEO began his tenure with a significant layoff.
The state of being no longer employed because one's job is no longer needed.
Redundancy was common in the industry due to automation.
Termination of employment due to business conditions.
The recession forced the company to initiate a layoff.
The state of being redundant.
A cost-saving measure by temporarily reducing staff.
The layoff was difficult, but the company hoped to rehire employees later.
Something redundant or excessive; a superfluity.
A layoff or downsizing is the temporary suspension or permanent termination of employment of an employee or, more commonly, a group of employees (collective layoff) for business reasons, such as personnel management or downsizing (reducing the size of) an organization. Originally, layoff referred exclusively to a temporary interruption in work, or employment but this has evolved to a permanent elimination of a position in both British and US English, requiring the addition of "temporary" to specify the original meaning of the word.
Repetition of linguistic information inherent in the structure of a language, as singularity in the sentence It works.
The act of suspending or dismissing an employee, as for lack of work or because of corporate reorganization.
Excessive wordiness or repetition in expression.
A period of temporary inactivity or rest.
The state or fact of being unemployed because work is no longer offered or considered necessary.
A dismissal of employees from their jobs because of tightened budgetary constraints or work shortage (not due to poor performance or misconduct).
A dismissal of an employee from work for being no longer necessary; a layoff.
A period of time when someone is unavailable for work.
(Electronics) Duplication or repetition of elements in electronic equipment to provide alternative functional channels in case of failure.
A short pass that has been rolled in front of another player for them to kick.
Repetition of parts or all of a message to circumvent transmission errors.
A bet that is laid off, i.e. placed with another bookmaker in order to reduce risk.
(Genetics) See degeneracy.
The act of laying off an employee or a work force
The state of being redundant
A superfluity; something redundant or excessive; a needless repetition in language
Duplication of components or circuits to provide survival of the total system in case of failure of single components.
Duplication of parts of a message to guard against transmission errors.
The state of being unemployed because one's job is no longer necessary; the dismissal of such an employee; a layoff.
(law) surplusage inserted in a pleading which may be rejected by the court without impairing the validity of what remains.
Repetition of messages to reduce the probability of errors in transmission
The attribute of being superfluous and unneeded;
The use of industrial robots created redundancy among workers
(electronics) a system design that duplicates components to provide alternatives in case one component fails
Repetition of an act needlessly
Job loss due to economic or technological changes.
Technological upgrades in the company resulted in redundancy for some workers.
An employment condition where the employer needs to reduce the workforce.
The firm announced a redundancy to streamline its operations.
Do redundancy laws vary by country?
Yes, redundancy laws differ significantly from country to country.
Is a layoff always permanent?
No, layoffs can be either temporary or permanent.
Does redundancy mean poor performance?
No, redundancy is not related to job performance but to the necessity of the job.
Do labor unions affect layoff and redundancy processes?
Yes, unions often negotiate terms and conditions of layoffs and redundancies.
Can you be rehired after a layoff?
Yes, it's possible to be rehired if the company's conditions improve.
Is severance pay guaranteed in a layoff?
Not always; it depends on the company's policy and local laws.
Is it common to challenge a redundancy?
Employees may challenge a redundancy if they believe it's unfair or illegal.
Can an entire department be laid off?
Yes, if the company decides to eliminate that department's functions.
Can voluntary redundancy be an option for employees?
Yes, some companies may offer voluntary redundancy to reduce their workforce.
Can a temporary layoff become a redundancy?
Yes, if the employer decides the job is no longer necessary.
Is notice required for redundancy?
Typically, yes, but the required notice period varies.
Are laid-off workers eligible for unemployment benefits?
Generally, yes, but eligibility criteria vary by location.
Are all terminated positions considered redundancies?
No, only those terminated because the job itself is no longer needed.
Might a company offer retraining instead of layoffs?
Yes, some companies may offer retraining to retain employees in new roles.
Does redundancy affect the reputation of the dismissed employee?
No, since redundancy is not related to individual performance.
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Tayyaba Rehman is a distinguished writer, currently serving as a primary contributor to askdifference.com. As a researcher in semantics and etymology, Tayyaba's passion for the complexity of languages and their distinctions has found a perfect home on the platform. Tayyaba delves into the intricacies of language, distinguishing between commonly confused words and phrases, thereby providing clarity for readers worldwide.