We have created a 3-step guide for employers on how to conduct a fair redundancy procedure. This guide focuses on undertaking a fair and transparent consultation process with the affected employees.
• Once an employer has identified those employees who are provisionally at risk of redundancy, following “A three-step guide to redundancy - Step 1 Placing employees at risk and selection”, they should undertake a meaningful consultation with those employees to explain the planned changes and to obtain the employees’ feedback and input.
• Employers should write to those employees that have been provisionally selected for redundancy, inviting them to a meeting to discuss their provisional selection. An employee should be informed of their right to be accompanied to this meeting by a trade union representative or colleague. During the Covid-19 pandemic, and with many employees working from home, the consultation meeting may be held remotely via, for example, telephone or video call. There is no legal requirement to consult face to face.
• During the redundancy meeting, an employer should consult with the employee on the redundancy process, the proposal to select them for redundancy, the redundancy payment due to them if their dismissal is confirmed, ways of avoiding redundancy and alternative job roles, if any are available. An employer should consider any comments made by the employee during the redundancy meeting and follow up on any suggestions made to avoid compulsory redundancies, scheduling a further meeting if necessary.
• Where an employer is proposing to make fewer than 20 redundancies, there is no set time period for how long consultation should last before issuing redundancy notices. However, an employer should not give an employee notice of redundancy until each affected employee has been consulted with.
• Where a decision is made to make an employee redundant, an employer should invite the employee to a further meeting to confirm their selection and to go through the redundancy package. An employee should be informed of their right to be accompanied to this meeting by a trade union representative or colleague. This will be dealt with in “A three-step guide to redundancy - Step 3 Termination of employment and appeal”.
• Where an employer proposes to make 20 or more employees redundant at the same workplace within 90 days, they must follow the collective consultation rules set out in statute. This means that the employer must consult with any recognised trade union or, if there is not one, elected employee representatives. There are also a number of further matters prescribed by statute which must be covered in consultation. It is important that an employer collectively
• consults when they are making large-scale redundancies because any failure to do so can have significant financial penalties. If an employer fails to meet the collective consultation requirements, employees can make a claim for a protective award against their employer and, if the claim is successful, an employer may have to pay up to 90 days’ full pay for each affected employer (unless they have a ‘special circumstances’ defence).
• In addition to the collective consultation, employers should also consult with employees individually (as above).
• Where an employer is proposing to make 20 to 99 redundancies within 90 days within one workplace, the consultation must begin at least 30 days before giving the first redundancy notice. Where an employer proposes to make 100 or more redundancies, consultation must begin at least 45 days before the first dismissal takes effect.
• By law, an employer is also required to notify the Secretary of State when they are making large scale redundancies. Notification must be received by the Secretary of State at least 45 days before the first dismissal, where the employer proposes to dismiss 100 or more employees within a 90-day period. Where less than 100 redundancies are proposed, the notification period is 30 days.
Our employment team can advise on how to conduct a fair redundancy procedure, including the consultation rules, and are currently offering a redundancy package which consists of a number of redundancy templates and letters for a fixed fee of £1,000 plus VAT.
If you need assistance or advice on the contents of this article, please contact Thackray Williams LLP who have set up a FREE Legal Advice Line to businesses and employees in the wake of COVID-19. Do get in touch on 020 8663 4127 if you wish to discuss this matter in more detail or require any further advice.
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