Legal Article - Employment Law

What is a Fair Redundancy Procedure?

Responsibility for deciding the size of the work force rests with management. But before taking the final decision to make any substantial reduction, management should consult employees or their representatives, unless exceptional circumstances make this impossible.
 
It may be sensible for employees to organise elections for employee representatives on a “just in case” basis well before any redundancies are contemplated. Employers may wish to set up a plan for organising elections at short notice. Certainly an employer should ensure the invitation to elect representatives is given sufficiently far in advance to enable consultation to begin in good time.
 
If the employees are slow in choosing representatives, making it impossible to start consultations in good time, it will probably be sufficient for the employer to consult as soon as reasonably practicable after the representatives are elected.

An agreed system for the elected employee representatives to report back to the employees whose jobs are under threat, covering accommodation and other facilities needed, could be helpful to the employer when an acrimonious redundancy programme is announced.

A policy for dealing with reductions in the work force, if they become necessary, should be worked out in advance so far is practicable and should form part of the undertaking’s employment policies. As far as is consistent with operational efficiency and the success of the undertaking, management should, in consultation with employee representatives, seek to avoid redundancies by such means as:

I. restrictions on recruitment;
ii. Retirement of employees who are beyond the normal retiring age;
iii. Reductions in overtime;
iv. short-time working to cover temporary fluctuations in manpower needs;
V. re-training or transfer to other work.

If redundancy becomes necessary, management in consultation, as appropriate, with employees or their representatives, should:

I. gives as much warning as practicable to the employees concerned and to the Department of Trade and Industry;
ii. Consider introducing schemes for voluntary redundancy, retirement, and transfer to other establishments within the undertaking, and a phased rundown of employment;
iii. Establish which employees are to be made redundant and the order of discharge;

iv. Offer help to employees in finding other work and allow them reasonable time off for the purpose;

V. decide how and when to make the facts public, ensuring that no announcement is made before the employees and their representatives and trade unions have been informed.

A redundancy procedure checklist which you may find helpful is as follows:

1. Ensure that there is in fact a possible redundancy (job(s) not person(s)). Can redundancy dismissal be avoided by restrictions in new recruitment, early retirement, cuts in overtime working, short-time working, re-training or transfer, etc?

2. Consult and warn all those employees who may be affected

3. Taking into account any representations that may have been made, decide which job(s) (not person(s)) are to be made redundant;

4. Apply the agreed criteria (from the firm’s redundancy policy) to; identify the individual(s) likely to be dismissed or redundant. If no agreed criteria exist, decide upon and apply fair and objective selection criteria. Remember to consider volunteers, early retirement, transfer, etc.

5. Consult those employees likely to be affected about
• Their views
• Possible alternative employment

6. Offer alternative employment if available and assistance to affected employees in looking for new jobs.

Once a redundancy decision has been made you should confirm in writing the terms of the redundancy. A suggested draft letter is shown within the Employment Law Downloads.

 

Published: 02 Jun 2011

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