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How to Start a Redundancy Process

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Redundancy can be necessary for a wide variety of reasons, but many employers find it difficult or simply don’t know how to start. From the redundancy selection process to communication and execution, there are many things you need to know in order to make the redundancy process as smooth as possible.

Failing to follow the proper protocol or unfairly making someone redundant can lead to complaints and legal action being taken. This may tarnish your business’s reputation and the employee may be able to make a claim through a tribunal.

Starting the redundancy process is as straightforward as clearly establishing a reason why you need to make a role redundant. This helps to ensure that the process is fair. Following this, there are several steps you will need to follow, such as:

  • Choosing a redundant role
  • Clearly laying out the process you are using to select the role being made redundant
  • Speaking to, and there for considering, the employees who undertake that role
  • Choosing a reasonable selection criteria to score several employees who do the same, or a similar role
  • Making the role redundant. This will require you to dismiss the individual who undertakes that role on the ground of redundancy, or dismiss the person who scored lowest as against the selection criteria.
  • Preparing for an appeal, just in case

Discover more about the redundancy process, and what makes a redundancy unfair, in the article below.

Beginning the redundancy process

The very first thing you need to do when starting the redundancy process is to identify a reason why the redundancy is necessary. Consider what costs you need to reduce as a business, what role may have become less important as of late, or which branch/office is closing.

If you do not have a clear reason why you need to make a role redundant and then dismiss an individual undertaking that role, they may believe that their dismissal was unfair and choose to make a claim against you. This is particularly likely if they have been working with you for 2+ years.

When beginning the redundancy process, it is also very beneficial to seek legal advice. By doing this early on, you may be able to mitigate risk, ensure the redundancy process is fair, and avoid costly claims.

How to fairly decide who to dismiss on the ground of redundancy

To fairly decide who to make redundant and who can continue to work with you, it’s important to start by focusing on the teams and positions within your business, instead of targeting an individual.

The Equality Act 2010 makes it illegal to dismiss a staff member based on their ‘protected characteristics’, especially due to disability, race, and sex. Doing so can lead to discrimination claims.

Redundancy solicitors can provide you with the necessary support and guidance to prevent these instances.

Making multiple people redundant at the same time

It’s important to note that if you need to make a large group of employees redundant, you may need to follow the collective redundancy process. This is relevant when an employee makes 20 or more employees redundant within a 90-day window. Getting this procedure wrong can lead to additional compensation being awarded.

Communicating with your employees regarding the redundancy selection process

Communication is key and it’s important to be transparent about your intention to make a role redundant. If you have narrowed your selection down to a group of individuals undertaking that role, speak to each of them as well as other members of staff.

This may provide you with the insight needed to make the right decision. It also allows your employees the opportunity to offer alternatives to dismissal, and if possible, you may be able to discuss them moving to a different position in the business as an alternative to dismissal by redundancy.

The final decision on redundancy

When you have selected the employee you wish to make redundant, it’s important to speak to them for any final questions or key points that may want to make. After this, you must provide a confirmation letter that confirms the dismissal by reason of redundancy. This must include their right to appeal. With the help of redundancy solicitors, you can use the correct wording and make the process much more straightforward.

Always consider the possibility of a redundancy appeal

No matter how smooth the redundancy process has been, you must advise the employee of their right to appeal. There is always a chance that the employee will feel the need to make an appeal against you. If you get this part of the procedure wrong, an unfair dismissal or discrimination claim may follow.

What makes a redundancy unfair?

It is possible that a redundancy may be considered unfair if you did not follow the correct redundancy procedure. This includes:

  • If an employer does not take the time to speak to those at risk of redundancy (“consultation”)
  • In the event that an employee was not provided with an opportunity to ask questions or offer suggestions of alternatives to dismissal
  • The employer does not explain why the employee was chosen to be dismissed by reason of redundancy

The start of the redundancy process is crucial to setting the tone and expectation for the entire proceeding. To reduce the chance of an appeal or dispute, it is highly recommended that you speak to a redundancy solicitor as early as possible.

For more information about the redundancy processes, get in touch with our employment law solicitors at Roythornes.

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