Getting Redundancy Right

By 9th June 2020 Uncategorised

RedundancyManaging the redundancy process, particularly around consultation is never easy. However, as news reports have shown over the last few days, getting it wrong can not only be damaging to a company’s reputation it could result in criminal charges against the board of directors.

It has been reported that former staff of Jamie’s Italian and One New Change, which traded as Barbecoa, won their employment tribunal claim for failing to properly consult with staff regarding terminating their employment (full story here).

Each of the 64 claimants will receive 56 days’ lost pay.

The timescales of consultation period are:

  • 20 to 99 redundancies – 30 days consultation period
  • 100 or more redundancies – at least 45 days consultation period

Redundancy Timescales

There isn’t a set timescale if a company is considering making redundancies of less than 20 staff, however companies still need to enter into formal and meaningful consultation with the individuals who will be affected.

It is always a difficult balance between keeping the staff informed without it damaging the performance of the company i.e. a reduction in orders from clients because they are worried that the company will close before completing the order.  The senior management team also need to be aware that decisions made 2 or 3 months before any formal process starts could be seen at an employment tribunal as the starting point of the redundancy process.  Therefore senior managers should be careful regarding anything that is recorded in written format including emails.

Overall companies should have open and honest communication with employees as early as possible if they are experiencing difficulties and redundancies are a consideration as employees may have new ideas on how they increase trade/profitability.

There are sometimes tough decisions to be made at the point where you are putting employees at risk of redundancy.

Preparation and Planning

With the current COVID-19 pandemic and flexible working practices; people working from home or from different sites, it can be a logistical nightmare to make sure everybody is available if companies have to make an announcement regarding the possibility of redundancies.  However, every effort should be made to make sure all staff effected are spoken to at the same time.  This may mean having several meetings being held at different locations or using technology such as Skype for the remote workers.

However, it is crucial to adopt a measured, thought-through approach from the very first meeting. Getting redundancy wrong can be expensive, with potential awards of 90 days’ pay per affected employee for failure to consult in a collective redundancy situation plus any compensation for unfair dismissal.

Getting redundancy right involves preparation, planning and expert legal advice.

HCHR

We are currently offering a 30 minute phone consultation, in which we can discuss this subject or any other employment related questions, with a follow up email summary covering all relevant advice for just £99 + VAT.

This special offer has been introduced to help businesses protect themselves during these unprecedented times – to book your consultation and give yourself some necessary peace of mind please call 01792 296 178 or email info@hchr.co.uk

HCHR

Author HCHR

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