Employment Law

Employment Law

Redundancies & Re-organisations

Do you have a genuine redundancy situation?  This is not always an easy question to answer.

Redundancy will generally arise from three principle changes to a business

  • the closure of a business
  • the closure of a site
  • the removal of a particular role or a reduction in the number of people required to carry out a certain type of work.

Redundancy is often thought low risk and straight forward - in reality that is not true. It can be complex and often involves the consideration of a number of variables to avoid a finding of unfair dismissal in the Employment Tribunal. 

An employer should therefore take time to go through a process that ensures true consultation occurs. Employers often fall into the trap of first confirming a decision and only then carrying out a consultation process.

The procedure to be followed will depend on the type of redundancy and the numbers involved.

For example:

1.   Where there are less than 20 employees which an employer is proposing to make redundant they will need to consider:

  • is there a pool of employees from which to select? 
  • which employees will be included in the pool?
  • how will select employees from the pool?
  • do you have any suitable alternative roles for those that are made redundant?

2.  If an employer is proposing to make 20 or more employees redundant they must adhere to the collective consultation process.

  • This often requires the employees to elect representatives with whom an employer must consult.
  • Consultation must be carried out over a minimum number of days depending on the number of employees proposed to be made redundant.

This is a highly regulated area and notoriously complex.  The price for failure to adhere to the correct procedure is high (up to 13 weeks gross pay for each individual employee affected). However, collective consultation is not a replacement for individual employee consultation.  Fairness to the individual is the requirement for a fair dismissal.

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