How to manage staff redundancies
Employers should adopt a formal redundancy policy. It should be drawn up when redundancies are not imminent, so the parties can consider the long-term implications.
aspire cambridge writes:
Alternative measures should also be considered to reduce the needs for redundancies and these should be discussed with staff as part of the consultation process. Examples of these would include: reducing overtime, redeployment, a freeze on recruitment etc. If the employee is redeployed, they are entitled to four calendar weeks by way of a ‘trial period’ in their new job. You can extend this to a longer period in writing. It is also possible to consider the possibility of voluntary redundancy.
The need for collective consultation is set out in law, and applies when 20 or more jobs are being made redundant. An appropriate format should be used to communicate with employees. An email or text is not an appropriate way to announce the possibility of a redundancy. If 20 or more redundancies are proposed, there will need to be elections of employee representatives to engage in the consultation process. You will need to meet with representatives to obtain staff feedback and discuss the issues arising and be involved in writing various letters at this stage.
Irrespective of the collective consultation you have been engaged in, you will need to consult with the individuals who are selected before any notice of dismissal is given. This is critical to avoid a finding of unfair dismissal. The employee must be made aware that they are ‘at risk’ of dismissal, why they are at risk, and that they have been provisionally selected for redundancy once they have been scored against selection criterion or through some other kind of selection process. The employee should also be made aware of their own personal scoring or markings in the assessment process.
Invite the employee to a meeting which is usually held with the employee’s direct manager to discuss the reasons the reasons for the redundancy, the process followed so far, why the individual has been selected, alternative employment, any financial package on offer and likely timescales.
Once the consultation process has concluded and selection criteria have been applied you should inform employees at risk of redundancy of your decision.
The right to appeal should be offered to all selected employees when they are issued with a dismissal notice. A senior manager who has not been involved in the redundancy exercise should hear any appeals.
Once an employee has been issued with a dismissal notice and qualifies for a statutory redundancy payment (i.e. have at least two years’ service) they have the right to reasonable time off with pay to look for new work or to undergo training for future employment and you must not unreasonably refuse such a request. The entitlement to such pay throughout the notice period is capped at two fifths of one week’s actual pay.
To qualify for statutory redundancy pay the employee must have two years’ continuous service. The payment is calculated on the basis of an employee’s age, length of service and weekly pay (subject to a weekly maximum, currently set at £489.
When all those who have been made redundant have left the organisation, arrange a meeting with the remaining employees to share the vision for the organisation.
If you need help managing your staff redundancies, or have any queries we could support you with contact our team CIPD accredited HR Consultants at aspire cambridge on 01223 855441.
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