Redundancy Procedure - Getting It Right
Monday, February 2nd, 2009Making 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.
Ensuring that the rules are followed will protect you from expensive tribunals and also make the entire procedure less emotional for those 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.
Next, you should remember that it is not the person that is made redundant - it is the job. Consequently, regardless of whether the position was a manual operation taken over by technology or it is no longer required by the business, you must ensure that the job itself disappears when the employee leaves. Even though you may have been informed otherwise, it is perfectly legal to employ new people when others are made redundant, provided any new recruits are employed to fulfil functions that are different to the one made redundant.
Once the need to make redundancies has been established, there are several stages which the employer will need to go through in order to ensure that their obligations are met.
Establishing Redundancy Criteria
The objective of redundancy should be to create an effective, streamlined workforce that are best able to take your business forward. Establishing well defined criteria for selection is the most effective way of ensuring that all employees are treated equally, and their benefit to the company is properly assessed. The criteria you use may include:
* Adaptability - particularly if your company is moving into a new area or market in order to move forward, you may need to retain those staff who are most comfortable with change and have the ability to adapt.
* Skills - keeping a good cross section of skills can help keep your workforce balanced and effective.
* Performance ” it is a wise move to retain your hardest-working employees. You will require documented evidence to support your decisions to avoid potential complaints of unfair treatment.
* 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, in order to ensure that the selection process is a fair and equal as possible, a combination of the above criteria should be used.
Consultation
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 is possible 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.
If you continue to communicate openly with both at risk staff and those who will be staying behind throughout the process, it will help to keep negative emotions to a minimum and reduce the possibilities of claims of unfair dismissal.
Offering Assistance
Whilst you are not legally required to do so, it is thought to be good practice to give as much practical assistance to those who have been chosen for redundancy as possible. This could be in the form of offering help regarding looking for alternative employment, guidance on CV writing and interview techniques or advice on financial planning in the meantime. Offering such assistance will help to maintain good relationships even with those employees who are leaving: once again, minimising the likelihood of complaint or legal action.
The procedure of making redundancies can be a very difficult task, particularly if you are not aware of its emotionally charged nature or of the possible legal ramifications.
