Redundancy - Getting it Right

by Kate Russell

Consultation

The initial consultation is about the organisation’s proposal to take actions which could result in redundancies. Before any final decision is made you must inform the employee of the proposal, provide details and explain the reason for it.

Allow employees time to ask questions and to provide feedback. Once they have had the opportunity to do so you will consider the feedback and make your decision about the form the final plan will take.

If the decision will place an employee or employees at risk of redundancy, you start individual consultations. There are likely to be a minimum of two discussions, but may be more if there is a selection pool.

Individual consultation

There is no minimum statutory consultation period when making fewer than 20 employees redundant, but you should still consult on an individual basis, otherwise the dismissal procedure may be considered to be unfair.

At the individual consultation meetings, the employer and employee should discuss

  • The grounds for the employee’s selection, including the criteria adopted and his or her scores against those criteria
  • Any suggestions that the employee makes in relation to avoiding redundancies
  • The possibility of alternative employment
  • Details of the redundancy payment that the employee will receive if the redundancy is confirmed
  • The notice period that will apply if the redundancy is confirmed, and arrangements such as whether or not the employee will be required to work the notice period
  • Any support that will be available, for example outplacement or time off to look for new work
  • And any outstanding related issues or questions that the employee raises.

The purpose of the consultation is to consider ways of avoiding the redundancy situation or dismissals, of reducing the number of dismissals involved and mitigating the effects of the dismissals. At the meetings, you should give the employee the opportunity to express his or her views and should give these genuine consideration.

You should hold further meetings with affected employees as necessary. This will depend on whether or not there are issues outstanding from the earlier meetings – for example, if further discussion is required relating to possible alternative employment.

Document the consultation process, including minutes of all meetings.

The consultation procedure is likely to last several weeks, though it could be significantly longer, depending on how it progresses. If you cannot avoid redundancies, notify the selected employees in writing, confirming that the reason for dismissal is redundancy, giving the appropriate notice period, the date on which their employment will terminate, the total redundancy payment and how this has been calculated.

While there is no statutory right of appeal, you would be wise to allow an appeal process, as a means of addressing any outstanding issues. It may help to reduce the risk of claims from employees who feel that they have been treated unfairly.

Consulting with absent employees

Employees who are absent from work, for example on sick leave or maternity leave, must be consulted properly if their roles are potentially redundant. A failure to do so may make any subsequent dismissal unfair. In some cases, it could be an act of unlawful discrimination. As with other staff, give absent employees early warning of potential redundancy and include them at each stage of the redundancy consultation process.

Ask the employee to confirm how he would like to be consulted, for example by way of meetings at the employee’s home, by telephone or in writing, and should try to accommodate the employee’s requests where reasonable.

Collective consultation

There are three situations where statutory consultation is required:

  • If between 20 and 99 employees are to be made redundant in one establishment within a 90-day period, the employer must consult with those employees’ representative(s) at least 30 days before a decision is made
  • If 100 or more employees are to be made redundant, the employer must consult with them at least 45 days before a decision is made
  • An employer intending to make 150 or more employees in one establishment redundant must adhere to the provisions of the Information and Consultation of Employees Regulations 2004 and inform and consult employee representatives
  • where there is a threat to employment in an undertaking
  • with a view to reaching an agreement on decisions likely to lead to substantial changes in work organisation or in contractual relations.

See Collective redundancies for the requirements for collective consultation.