Outlook Unlimited - Recruitment for Solihull, Birmingham, West Midlands, Warwickshire

Redundancy is a dismissal in law. It is one of six potentially fair reasons for dismissal and a minefield of legislation needs to be negotiated. With redundancy, there is no culpability on the part of employee. Statute identifies different rules depending on thresholds of numbers to be made redundant. Contract law will dictate certain requirements. Best practice either through ACAS codes, caselaw or simple “what is fair” as perceived by a Tribunal will control the procedure to be followed.

The Government requires consultation in potential redundancy situations with a view to employees possibly suggesting ideas as to how jobs may be saved. Considerable importance is attached to consultation with any trade unions involved or, lacking their presence, elect worker representatives. If employees do not wish to elect workforce representatives then it will still be necessary to consult with the workforce.

If the potential number to be dismissed is less than 20 at one establishment within 90 days or less then the statutory dispute resolution procedure applies as may a contractual redundancy policy or trade union agreement.

If 20 - 99 redundancies are proposed at one establishment within such time frame, 30 days consultation is required and where 100 or more are proposed at one establishment, 90 days consultation is required. For 20 or more proposed redundancies the employer should also complete an HR1 form and send it to the Department of Business and Regulatory Reform.

For the purposes of consultation with a trade union or employee representatives the employer must disclose to them, in writing, all the details regarding the redundancies such as reasons for proposals and the proposed method of calculating redundancy payments.

Explain why the situation has arisen and steps taken so far in the process.

Tribunals take a dim view of employers faced with financial difficulties who dismiss employees as a resolution. Employers need to explain to employees attempts made to increase sales by perhaps reducing prices or changing suppliers. A Tribunal will expect an employer to consider these factors before considering redundancies.

If ideas of how the jobs can be saved are not forthcoming then, next, consider how to identify how potential redundant employees can be saved. The most commonly used method is a points based selection procedure to identify valuable employees to retain.

Individuals identified as potentially redundant should be invited to a meeting to discuss their score(s) taken from the selection procedure. Prior to the meeting, provide to the employee, in writing, their own score(s) and that of the others in their pool.

Assuming no adjustments to the scores are necessary the employer must consider any other available jobs. A suitable alternative is one where the role is broadly similar with regard to the work itself. Special rules apply to women on maternity leave.

Having reached the end of the process those selected for redundancy are dismissed. Employers should send a formal letter to the employee terminating the employment which contains a financial statement complying with the requirements of statute, with regard to notice, or pay in any ex-gratia payments etc sufficient to enable them to calculate that the figures are correct. The letter should contain the right to appeal.

To contact Peninsula’s specialist consultant please call:

Peter Hipkiss,

M: 07966 112 075

Or

Simon Dodd

Tel: 0161 827 9918 (Xtn 8019)

Article provided by Peninsula Business Services