First and foremost, it needs to be stressed that redundancy is merely a particular reason for dismissal. Many employers often miss that obvious point and use ‘make redundant’ instead of ‘dismiss’ in the belief it sounds less harsh. The matter of fact is that if you make an employee redundant you are dismissing that employee and if that dismissal is not carried out properly the employer can leave itself open to potential liability.
As an employer, you may only make employees redundant, if you have genuine reasons for terminating the employment of employees. There are a number of key guidelines that you must adhere to when contemplating making employees redundant:-
You are under an obligation to draw up a plan to decide which employees would be kept on or made redundant. Our employment law solicitors can best advise you in planning redundancies.
You should note that in the event that 20 or more employees are at risk of being made redundant, you have a duty to consult with the employees’ representatives, including any relevant trade unions. Our employment law solicitors can best advise you on consultation procedures.
More tribunal applications are concerned with alleged unfair selection than with any other aspect. There are a number of selection methods and there is no single right answer to how an employer should select who is to go and who is to stay. Our employment law solicitors can best advise you on selection methods.
After the period of selection, the employer will have decided who is to stay and who is to go but the employee’s concerned do not yet know. The law makes it very clear that the step to telling the employee is much more complicated than merely conveying information. Our employment law solicitors can best advise you in the necessary consultation process for individuals prior to dismissing them.
By offering suitable alternative work an employer may escape liability for making a redundancy payment if an employee unreasonable refuses it. Offering suitable alternative work is also a general requirement on the employer as part of acting reasonably to seek solutions to whatever problem caused the redundancy. Without this step dismissal may be unfair. Our employment law solicitors can best advise you on offering alternative work to your employees.
The next duty of an employer is to see what redundancy payment is due to each of the dismissed employees. Both statutory redundancy payments and contractual severance terms will need to be considered. In addition, there is an entitlement to notice or payment in lieu. Our employment law solicitors can best advise you on what redundancy payments are payable to dismissed employees.
Consequences of failing to adhere to the correct procedures
In the event that the redundancy procedure is not carried out fairly this may lead to a claim for Wrongful dismissal, Unfair dismissal, or further Statutory redundancy payments. As a general rule “out of court settlements” of employment disputes are not legally binding in that they cannot exclude employees’ rights to take the matters concerned to an Employment Tribunal. However, this is legitimately circumvented by entering into formal compromise agreements with the employees which fulfil very specific legal requirements
Contact us here for an initial discussion and to make an appointment or call our mobile friendly number on +44 (0) 20 3581 5678 to speak to an Employment Law Solicitor.