Making redundancies can be the hardest part of the process when you need to streamline your business. It can sometimes feel as though you are in a nightmare of potential litigation.
When you make sure that you are sticking to the rules you will not only protect yourself from costly tribunals: you will ensure that the whole process is less emotional for everyone involved.
The most important thing to consider is to make sure that your employees know what is going on at all stages of the procedure. Should you fail to communicate with your employees of their representatives during this crucial process it will not only cause fear and uncertainty within the workforce, it will result in allegations of unfairness in the redundancy decisions - making certain that expensive legal proceedings will occur.
Secondly, it is important to remember that it is the job that becomes redundant - not the person. Whether it is because a manual operation has been superseded by technology, or simply that a particular function is no longer necessary, the job itself must disappear when the employee leaves. Contrary to popular opinion, it is perfectly legal to take on new staff whilst others are being made redundant. It may be that the skills needed to take your company forward cannot be found in your existing workforce -so as long as the new recruits are taken on to fill different functions, this is a perfectly legitimate process.
Once the requirement to make redundancies has been determined, there are a number of stages which the employer will need to go through in order to meet their obligations to the employee.
Establishing Redundancy Criteria
The major reason for redundancy should be to ensure that you have an effective, streamlined workforce that is best able to maintain and indeed improve your business. Determining well defined selection criteria is the best way to make sure that all employees are treated equally and that any benefit they bring to the company is properly assessed. The criteria you use should include:
* Adaptability - this is especially important if your company is moving into a new sphere or market in order to progress: you will need to retain those employees who can cope best with change and have the ability to adapt.
* Skills " maintaining an appropriate cross section of skills should help keep your workforce balanced and effective.
* Performance " it would be sensible to retain your hardest-working team members. If you choose to do this, you will need documented evidence to support your decisions in order to avoid potential complaints of unfairness.
* Attendance " this is a valid criterion only when it is applied fairly and consistently. Remember that it is not fair to use lack of attendance due to maternity, paternity or adoption leave.
Ideally, so as to make sure that the selection process is as fair and equal as humanly possible, a combination of the above criteria can be used.
Consultation With Staff
Consultation is a vital part of the redundancy process, both in terms of reducing the likelihood of unfair dismissal claims, and in keeping those who stay motivated and informed.
If it seems to be the case that you will be making more than 20 positions redundant within a 90-day period, you will also be required to inform the Department for Business, Enterprise and Regulatory Reform.
Rumours and speculation will quite often run rampant during times of redundancy. As a result, you should be prepared to be as open and honest as possible in order to avoid unnecessary confusion. In particular, inform those at risk at the earliest possible stage of the reasons for the redundancies, the positions and departments likely to be affected, the approximate number of employees at risk and what criteria you will be considering in the selection procedure. It is also important that you keep them informed of the time line of events.
Contact each individual who is at risk, explaining your reasons for considering them for redundancy and organising a meeting to discuss the situation. If you do not arrange this, you will automatically be accused of unfair dismissal.
Keep the lines of communication open with both the at risk employees and those you will be retaining as this will minimise any ill feelings and in turn reduce the chances of an unfair dismissal claim.
Providing Assistance
Even though you are not legally required to do so, it is a good idea to assist those you have selected for redundancy in as many practical ways as possible. This could mean offering assistance in obtaining alternative employment, CV writing guidance and interview technique or even financial planning assistance. Acting this way will assist both you and your former employee in maintaining good relationships and will also reduce the chances of legal action.
Making redundancies is a difficult and potentially highly emotional task, fraught with complex legal obligations.
When you make sure that you are sticking to the rules you will not only protect yourself from costly tribunals: you will ensure that the whole process is less emotional for everyone involved.
The most important thing to consider is to make sure that your employees know what is going on at all stages of the procedure. Should you fail to communicate with your employees of their representatives during this crucial process it will not only cause fear and uncertainty within the workforce, it will result in allegations of unfairness in the redundancy decisions - making certain that expensive legal proceedings will occur.
Secondly, it is important to remember that it is the job that becomes redundant - not the person. Whether it is because a manual operation has been superseded by technology, or simply that a particular function is no longer necessary, the job itself must disappear when the employee leaves. Contrary to popular opinion, it is perfectly legal to take on new staff whilst others are being made redundant. It may be that the skills needed to take your company forward cannot be found in your existing workforce -so as long as the new recruits are taken on to fill different functions, this is a perfectly legitimate process.
Once the requirement to make redundancies has been determined, there are a number of stages which the employer will need to go through in order to meet their obligations to the employee.
Establishing Redundancy Criteria
The major reason for redundancy should be to ensure that you have an effective, streamlined workforce that is best able to maintain and indeed improve your business. Determining well defined selection criteria is the best way to make sure that all employees are treated equally and that any benefit they bring to the company is properly assessed. The criteria you use should include:
* Adaptability - this is especially important if your company is moving into a new sphere or market in order to progress: you will need to retain those employees who can cope best with change and have the ability to adapt.
* Skills " maintaining an appropriate cross section of skills should help keep your workforce balanced and effective.
* Performance " it would be sensible to retain your hardest-working team members. If you choose to do this, you will need documented evidence to support your decisions in order to avoid potential complaints of unfairness.
* Attendance " this is a valid criterion only when it is applied fairly and consistently. Remember that it is not fair to use lack of attendance due to maternity, paternity or adoption leave.
Ideally, so as to make sure that the selection process is as fair and equal as humanly possible, a combination of the above criteria can be used.
Consultation With Staff
Consultation is a vital part of the redundancy process, both in terms of reducing the likelihood of unfair dismissal claims, and in keeping those who stay motivated and informed.
If it seems to be the case that you will be making more than 20 positions redundant within a 90-day period, you will also be required to inform the Department for Business, Enterprise and Regulatory Reform.
Rumours and speculation will quite often run rampant during times of redundancy. As a result, you should be prepared to be as open and honest as possible in order to avoid unnecessary confusion. In particular, inform those at risk at the earliest possible stage of the reasons for the redundancies, the positions and departments likely to be affected, the approximate number of employees at risk and what criteria you will be considering in the selection procedure. It is also important that you keep them informed of the time line of events.
Contact each individual who is at risk, explaining your reasons for considering them for redundancy and organising a meeting to discuss the situation. If you do not arrange this, you will automatically be accused of unfair dismissal.
Keep the lines of communication open with both the at risk employees and those you will be retaining as this will minimise any ill feelings and in turn reduce the chances of an unfair dismissal claim.
Providing Assistance
Even though you are not legally required to do so, it is a good idea to assist those you have selected for redundancy in as many practical ways as possible. This could mean offering assistance in obtaining alternative employment, CV writing guidance and interview technique or even financial planning assistance. Acting this way will assist both you and your former employee in maintaining good relationships and will also reduce the chances of legal action.
Making redundancies is a difficult and potentially highly emotional task, fraught with complex legal obligations.
About the Author:
Katherine Wiid is a specialist in employment and redundancy and has written many articles specifically about the complex Redundancy Selection process. For further information on Redundancy Procedure, check out the website.
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