According to the ICAEW “Business confidence in the South West stands at -7.0 this quarter” this is the third successive quarter in the negative figures. Only last month local Gloucestershire firm Renishaw announced big changes to its location and organisation structure, and in turn possible job losses. In July 2019 Bookmakers; William Hill announced the possible closure of local shops resulting in a number of redundancies across the region.
Redundancy is not something business owners and directors comfortably and openly talk about, but let’s be honest, in times of huge economic uncertainty, strategic changes might be essential to business survival, and it may be a new consideration for firms that are facing pressure.
As local Gloucestershire HR consultants, we have supported many firms over the last 10 years and guided them, step-by-step through the redundancy process. The legalities are the same across the board however a businesses’ culture, its individual employees and circumstances impact the process and we help to ensure the best approach is provided to our clients. Redundancy situations can result in an unfair dismissal at Employment Tribunal if the correct process is not followed – we highly recommend seeking support and advice, to ensure the business is protected.
We are not seeing a particular increase in redundancies; we are helping some of our clients with planning ‘just in case scenarios’ because of the political and economic uncertainty. Handling redundancies and potential dismissals is a daunting but sometimes unavoidable situation. Here’s our overview which outlines the basics of the redundancy process and how to ensure it is as fair as possible, again we strongly advise engaging with experienced HR Consultants to support you throughout this process.
Overview of the Redundancy Process
What is Redundancy? Redundancy is when an employee’s job is no longer needed and they are therefore dismissed, but to be a genuine redundancy there needs to be some specific reasons which might include; change in firmwide direction, surplus in labour, new technology that replaces roles, change in premises, or a business is closing down. The key is that the role doesn’t exist anymore, and the employer cannot simply make someone redundant then directly replace the employee with someone else – this would be an unfair dismissal.
Redundancy Policy: Basic but essential, ensure you have an up-to-date Redundancy Policy within your employee handbook which employees have had access to read and acknowledged. This manages expectations and sets out the initial process.
Communicate in Advance: Ensure communication lines are clear and provide the employees that are impacted advance warning of the impending redundancy situation. This should be followed up with an ‘At Risk’ letter which is distributed to those impacted. If you have employees on paternity, maternity or long-term sick leave that are impacted it’s important to ensure they also receive the communications if it’s relevant to them.
Fair Selection: Depending on the individual firm, this may vary greatly, with redundancies possibly affecting lots of employees or just a few, work closely with an expert or HR Consultant to ensure the selection and pool of individuals is fair and set against a non-discriminatory scoring criteria – this ensures you avoid indirect discrimination.
Individual Consultations: all employees who have been selected as at risk must be communicated to and invited to an individual consultation meetings. The aim of this meeting is to discuss their individual scores against the criteria selected. It is again important these meetings are documented and address any outcome; i.e. if the employee challenges their scores.
The Group Consultation Process: If you are reducing staffing by 20 or more all those employees you need to follow some specific steps called a ‘Collective Redundancy’. In this process you are having a two-way dialogue – with an aim to avoid redundancy through looking at alternatives which might include offering job sharing opportunities, reduced hours, sabbaticals etc. At least two consultation meetings should be offered during the redundancy process. These meetings should be open and may mean the business has to re-think their initial alternative employment options and arrangements in a bid to avoid redundancy. It is during this stage that you can ask if there are any requests for voluntary redundancy. As with all sensitive meetings, a written documentation is essential to confirm what was discussed.
Review Meeting: if you have a situation where you have a ‘pool’ of staffing from which you need to select employee’s to be made redundant management and HR Experts would normally hold a review meeting between the consultation meetings. This is when they apply a selection criteria (which should have been discussed at the consultation meetings) to the employees that are at risk of redundancy. To make the process as objective as possible, more than one individual should be involved in this process.
Dismissal: if after the consultations and all other alternative options are not viable, a final meeting should be held. During this meeting final discussions and options are considered, before confirmation of the decision is given, and this should be followed up in writing to the employee in question. The letter will include details of notice, the redundancy package and their right to take time off work to seek alternative employment. The employee must here be offered the right of appeal.
Like any formal HR processes at formal meetings employees will be entitled to be represented at meetings by either trade union reps, or a colleague, this can give them support during difficult meetings.
The above is a summary and processes will be adapted depending on the Company, its policies and the employee. It is important employers follow the appropriate process, and having a HR Consultant involved often defuses what can be an emotionally charged situation as they are experienced in having this conversations. .
We’d be happy to discuss further with any of our contacts and clients that may be having to consider the redundancy process, please get in touch with your usual contact or contact: Rise HR Ltd, call us on 0844 854 6704 or email us at hello@risehr.co.uk.