Making redundancies: a practical guide (part 3)


With the end of the furlough scheme fast-approaching, many businesses will be in the unfortunate position of having to make redundancies.  We've been offering a practical guide to doing this in our series of articles.  Parts 1 and 2 explained how to work out if you need to consult collectively and how to carry out selection and pooling.   This last instalment explains how to consult individually with employees put at risk of redundancy.

The purpose of redundancy consultation is to give the opportunity to ask questions and make representations about the proposed redundancy, with a view to changing the outcome, and to explore options for alternative employment.  

Clients sometimes confidently tell us that they can't imagine the first consultation meeting will last long, as the employee can't possibly have much to say about the proposed redundancy.  Those are the redundancy processes that usually come unstuck.   In many cases there is plenty to say.   Even where the employee has limited scope for challenging the decision on legal grounds, it's important that consultation is fair, genuine and handled with at least some emotional intelligence.  Failing to do so can leave a bad taste in both parties' mouths and unsettle the staff who remain.  A reputation for handling redundancies poorly can haunt the business for some time and make it harder to recruit, particularly with the popularity of employee review sites like Glassdoor.

So what do employees need to address?  Typical issues for consultation include:

  • The rationale for the redundancy: Employees will often seek to challenge the business case for redundancy, particularly if they feel they've been singled out.  Don't assume that they won't ask for detailed breakdowns of the financial aspects or query the assumptions of the business case. 
  • Pooling and selection:  It's common for employees to argue that the pool should have been different or that their scores against selection criteria are unfair.   Employers need to be ready to back up their decisions, with evidence for the scores. 
  • Alternatives to redundancy: Employees often suggest alternatives such as going part-time, taking a pay cut or changing their role.  Employers need to consider these with an open mind. 
  • Alternative roles:  Where other roles are available, employees may argue that seemingly very different roles would in fact be suitable for them.  Conversely, an employee might argue that an available role isn't suitable (to avoid forfeiting their right to a redundancy payment). 

The common theme is that these points are usually easy to anticipate with a little thought at the outside. Employers shouldn't jump headlong into a redundancy process without having thought through these issues. 

Employers also need to give the employee some space to express their concerns about the personal impact of the redundancy.  In some cases employees could be facing a harsh financial position, or the loss of a much-loved career.  Employers need to be sensitive to this and treat the employee humanely. 

Finally, employers should offer an opportunity to appeal.  Although some cases suggest that this isn't a legal necessity, it's usually advisable to ensure that the process is fair. 

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