TOP TIPS: MANAGING REDUNDANCY PROCESSES
Top Tips for Managing Redundancy Processes: Protecting Your Business and People
Redundancy processes fall into one of two categories:
1) Non-collective – where an employer anticipates making anywhere between 1 & 19 roles redundant; and 2) Collective – where an employer anticipates making 20 or more roles redundant, at one establishment, within a period of 90 days.
“This article provides some ‘top tips’ if you are needing to carry out a non-collective redundancy process.”
This article provides some ‘top tips’ if you are needing to carry out a non-collective redundancy process.
1. Be sure that you are actually dealing with redundancy
Often redundancy processes are used as a way of removing difficult individuals from the business, as an alternative to going through a performance management or disciplinary process. This is a risky strategy; unless you can properly articulate why you need to lose certain roles from the business and why that needs to happen now, you risk claims for unfair dismissal and / or discrimination. A watertight business case showing why you believe you have a reduced requirement for the work of a particular kind is a non-negotiable starting point.
2. Make decisions in partnership with your staff
A fair process involves meaningfully consulting with staff before you make any decisions. Tribunals want to see that you’ve had a transparent dialogue with employees from the outset – what do they think about your proposal to make redundancies? Do they agree it’s the right thing to do for the business? Or are there other options available (e.g. might some people want to go voluntarily, might staff accept a reduction in pay, or job shares etc?). If redundancies are necessary, how does the business achieve the fairest outcome? – how do you fairly select who goes, what criterion do you use, have you scored individuals fairly based on their contribution to the business? All of these things should be discussed – and ideally agreed with staff – during well documented 1:1 consultation meetings.
3. So far as possible, ensure a level playing field
Adopt objective selection criteria, making reasonable adjustments where necessary. This should ensure that employees are not disadvantaged by reason of disability or pregnancy, or indeed any other protected characteristic.
4. Ensure all staff are included in the process,
Even if this means hosting consultation meetings via Teams or over the phone. Where staff are off sick or enjoying a period of family leave, don’t forget about them - make proper attempts to engage them fairly and meaningfully in the process, to ensure they have a fair opportunity to make representations.
5. Think outside the box when you are exploring alternative employment
Tribunals will expect to see some evidence that you have made proper attempts to find suitable alternative employment for any ‘at risk’ employees, even if this might involve a short period of retraining or upskilling. You should also discuss with staff the option of them taking on more junior roles, even if these don’t appear suitable to you at first; some staff might be happy to take a slight demotion, if this will ultimately keep them in a job.
6. Make allowances for how stressful the process will be for staff
Whilst there is no legal requirement to allow staff to be accompanied at redundancy consultation meetings, this is best practice, particularly where an employee might require assistance (perhaps because of a disability or a language barrier) or where the employee is particularly vulnerable (e.g. where they are currently on long-term sick or have returned from an extended period of absence). You should also direct staff to any available employee assistance programmes and encourage them to speak to senior management or HR if they have any questions or concerns during the process.
7. Keep a clear paper trail of your consultation process
Typically, a non-collective redundancy process will involve: a group meeting where staff are first advised that they are at risk, followed by at least two 1:1 consultation meetings, and then a final dismissal meeting and possibly also an appeal hearing. These meetings should be well documented, and each meeting should be sandwiched by a clear invite letter, and a comprehensive outcome letters, advising of next steps.
8. Offer the right of appeal
Even where staff have under 2 years’ service, offering the right of appeal is best practice, and ultimately, an appeal process presents an opportunity to correct any procedural or substantive failings in the main process and to get a sense of whether an employment tribunal claim may follow.
9. Handle ‘protected’ or ‘without prejudice’ conversations with care
Typically, we see clients offering Settlement Agreements at the outset of a redundancy process as an alternative to going through a full process. This can make good commercial sense, and a signed Settlement Agreement is the only way to guarantee you won’t receive a tribunal claim. However, just keep in mind that a Settlement Agreement should not be presented as a fait accompli; if staff decline the offer, you should be prepared to consult with them fully and with an open mind about the outcome of the process.
