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MANAGING REDUNDANCIES - THOMAS GUISE

Home / News & Opportunities / Member News

Date: 14/06/2017

An employee is deemed to have been made redundant where he/she is dismissed from employment for one or more of the following reasons...

  • The employer no longer carries on the business in the place where the employee was employed;
  • The employer no longer carries out the business in which the employee was  employed;
  • There is no longer a need for the business to carry out the particular kind of work for which the employee was employed;
  • The needs of the business for employees to carry out work of a particular kind in the place where the employee was employed cease or diminish.
 
The definition of redundancy is important in ascertaining whether or not there is a genuine redundancy situation, whether or not the dismissal was fair and whether the employee is entitled to a redundancy payment. 
 
This article is aimed at providing a step-by-step guide as to how business can effectively and appropriately manage redundancies.
 
Step 1
Brief your manager(s) - It is important that managers are appropriately trained and prepared to help support you through the redundancy process. It is vital that managers are kept up to date regularly. This helps them understand the direction the business is heading towards, as well as suggesting ideas that may help assist the process or even help avoid the redundancies.

Step 2
Talking to you staff – you are obliged to carry out individual consultations with staff. There is no set period of consultation, but all consultation should be meaningful depending on your circumstances. A meaningful consultation would involve discussing with staff the redundancy proposals and the impact this is likely to have on their employment. You should also take this as an opportunity to consider any alternate suggestions that your employees may have.
You can in addition to the individual consultation carry out group consultations. You must not however replace individual consultation with group consultation.   

Step 3
Selecting staff for redundancy – where you wish to reduce staff/team members rather than a certain role, you will need to set a selection criteria for the pool of staff to be considered for redundancy.
Once you have identified the pool of staff and how to fairly choose between them, you will need to draw up a selection criteria. This list does not have to be exhaustive, but should ideally list more than three points, to show that your selection is fair and in line with business interests.
Take care not to discriminate against anyone, exclude any absences that might have been caused due to disability, pregnancy or maternity.

Step 4
Giving notice and pay - once the above steps have been taken, you need to inform staff of their dismissal and ensure that they are paid correctly.
Notice of dismissal should be given at a formal dismissal meeting and this should be followed up with written confirmation. You should also ensure that staff are made aware of the appeal procedures in place.  

Step 5
Notice rights - employees who at their end of their redundancy notice period would have had a minimum of two years’ continuous employment at the end of their notice, have a right to reasonable time off during working hours to look for work or make arrangements for training. Some of this may have to be paid time off.
A complete refusal for time off is likely to be unlawful. You are however, entitled to take into account the needs of your business when considering any such requests.  
Where you have alternate roles available in your organisation, you should consider offering them to individuals who have been selected for redundancy.
Suitable roles should be offered to employees within their notice period and before employment ends. Employees usually have a statutory trial period of four weeks for the new role offered to them. The trial period can be used to asses the suitability of the role.  

Step 6
Allow staff to appeal - It is good practice to allow employees the opportunity to appeal their redundancy dismissal. Ideally you should have in place an appeal system and employees should be notified of this procedure in writing. The decision of any appeal should be given to the employee in writing.  

Step 7
Carrying out a redundancy procedure can a be challenging process for business of all sizes. Once the process is over it is important to factor in how your business has changed and what steps you can take to stabilise and grow your business.
It is also important to remember that the redundancy process will also have been a difficult period for staff who remain. In order to maintain a positive and committed work force, you should speak to them, take their views and suggestions going forward. This will no doubt help increase their morale and enthusiasm.

If you would require further advise on redundancy processes or have any employment queries, please contact our Employment Team 01527 912912.