Redundancy Part Two: Redundancy Procedures
As discussed in our Redundancy Part One blog, "Redundancy Part One: What it is & What to do”, every employer should consider having a formal redundancy procedure. The exact procedures will vary according to the time and size of the redundancy programme. Organisations should follow these stages as a minimum:
- Planning
- Identifying the pool for selection
- Seeking Volunteers
- Consulting employees
- Selection for redundancy
- Suitable alternative employment
- Appeals and dismissals
Planning
Employers should always try to avoid redundancies and consider different options such as:
- Recruitment Freezes
- Stopping or reducing overtime
- Offering early retirement to volunteers
- Retraining or redeployment
- Pay freezes
- Short-time working
It is important to note that employers will not be able to adopt these options without breaking their employees’ contracts.
Identifying the pool for selection
The group from which employees will be selected for redundancy must be identified carefully. It consists of at least one of the following:
- Those who undertake a similar type of work
- Those who work in a particular department
- Those who work at a relevant location
- Those whose work has ceased or been reduced or is expected to be.
Seeking Volunteers
To avoid compulsory redundancies, offering a voluntary redundancy package and seeking volunteers may avoid this.
Consulting Employees
Employers are required to consult employees and give them a reasonable warning of redundancy. There is no minimum statutory timescale when less than 20 employees are made redundant the consultation must be meaningful and be covered by contractual terms or policies. The employee is also entitled to be accompanied at all consultation meetings by a trade union representative or a colleague.
If more than 20 employees at one company are to be made redundant, collective consultations with recognised trade unions or elected representatives must start within minimum time scales:
- At least 30 days before the notification of redundancies for dismissals of 20-99 employees.
- At least 45 days before the notification of redundancies for dismissals of 100 or more.
Collective consultation must be completed before the notice of dismissals are issued to employees.
At the start of the consultation process, the employer is legally obliged to give the following information to the representatives:
- Reason for redundancy dismissals
- Number of redundancies and their job types
- Number of employees affected
- Methods of selection
- What procedure is going to be followed while dealing with the redundancies
- How redundancy payment is going to be calculated
Selection for redundancy
Once the consultation is finished, the employer may need to choose individuals from within the selection pool if there are not enough volunteers for redundancy. These choices must be based on objective criteria such as:
- Length of service
- Attendance records
- Disciplinary records
- skills, competencies, and qualifications
- Work experience
- Performance records
Suitable alternative employment
Employers must consider offering alternative work to redundant employees. If the employee refuses alternative work, they might lose their entitlement to a statutory redundancy payment. Employees can trial the alternative work for a period of four weeks. If the employer and the employee both agree that the role is not a suitable alternative, then the employee reverts to being redundant.
Appeals and dismissals
Employers should give written notice to those selected for redundancy. Employees should be notified that they are at risk of redundancy and be invited to individual meetings. Once the individual consultation is complete, the employer must decide whether the employee is to be made redundant and give them their written redundancy notice.
Related Articles:
Redundancy Part One: What it is & What to do
Redundancy in the UK: A Guide to Avoiding Unfair Selection
