HR Advice – A Redundancy Guide for Employers
As the Coronavirus Job Retention Scheme (CRJS) winds down on 30th September 2021, companies are adapting their practices and procedures in line with the current situation to ensure business viability. This includes reviewing their workforce to establish whether the levels of staffing are sustainable, or if changes need to be made.
Because of this, unfortunately part of business recovery may include redundancies, especially for those that have had no choice but to furlough employees to combat the economic downturn and national lockdown measures due the pandemic.
What is Redundancy
Redundancy is a form of dismissal that occurs when there is no longer a business need for a particular job role or roles. Redundancies should be carried out fairly, with employers adhering to the correct process throughout planning and consultation periods. Employers should always look for ways to avoid or prevent redundancies before coming to a final decision.
The Redundancy Process
If there are several staff who perform a similar type of role within the area of business that needs restructuring, you need to include these employees within a ‘pool’ of people who are at risk of redundancy. In some circumstances, the selection pool may just include one employee.
It is important to be clear on your reasoning for selecting the pool of choice, keeping in mind that these considerations are likely to be discussed during the consultation period.
Communicate clearly with employees
Employees at risk of redundancy need to be informed that their role is at risk as soon as possible. You can choose to do this as part of a group meeting with your selection pool, or one-to-one if the pool is smaller. This gives employees the opportunity to understand the proposed changes and understand the reasoning for the decision.
Employers are required to start consultation as soon as possible after making the business decision. You should make it clear in this meeting that this is the start of their redundancy consultation process.
Employers must consult on the business reason for proposed redundancies, the number of redundancies and area of the business affected, the selection criteria and how redundancy pay is calculated.
Employers should decide on the criteria they will use to score staff to determine who will be made redundant and do this fairly. This may be already defined within your redundancy policy, but most businesses score based on the level of skill and transferable knowledge, attendance and performance reviews.
It is discriminatory to score based on any Protected Characteristic such as sex, race, pregnancy or maternity, or age, also extending to part-time or employees on fixed-term contracts.
First consultation meeting
After being informed that they are at risk in an initial Announcement Meeting, at the first formal consultation employers should explain how individuals have scored and provide opportunity for feedback.
Employees have the right to be accompanied at consultation meetings and can challenge the business reasoning and suggest alternative options. Throughout the process, employers must consider these alternative options to redundancy, including offering suitable alternative roles, and responding clearly to any suggestions raised within the meetings.
Ensure all alternatives have been explored
There is a strong argument for finding alternative positions for at-risk staff as opposed to redundancies, largely due to the business knowledge and skill of employees who are at risk. Employers should consider what roles may be available in different areas of the business for which employees may be suitable.
Suitability is judged on how similar the role is to their current position, and the level of skills required for any new role. If an employee refuses a role that is deemed a ‘suitable’ alternative, they would not be entitled to redundancy, although some businesses may still allow an employee to leave on redundancy terms.
Final dismissal meeting
At this final meeting, employers should issue employees with notice of redundancy, adhering to notice periods defined within employment contracts. Employers should ensure employees have provided feedback, if they wish, and give written notice confirming that their post has been selected and outlining their redundancy terms. Whilst an employee is working a notice period, employers are required to continue to look for alternatives to redundancy – showing you have done all you can to avoid making the decision.
So that the process is fair, employees can choose to challenge a decision under the right to appeal. If this is the case, it is worth using an independent HR professional to carry out the process to ensure any decision made is fair, there has been no evidence of discrimination and that all possible alternative options have been explored thoroughly.
For confidential advice on any HR matters, including Redundancies, we provide the opportunity for a 15 minute support call with Director Suzanne Hurndall – book straight to calendar below:
With specialist expertise in leadership, change management, strategy, acquisition, workplace culture, transformation and discrimination, Suzanne is passionate people leader motivated by unlocking the potential of people, teams and organisations through teamwork and collaboration.