Redundancy is a particularly complex part of employment law and many businesses worry they are not carrying out the redundancy process in the correct way. Our step by step guide will walk you through the exact process you need to follow to carry out a fair and lawful redundancy.
Step 1- Be open and transparent
As an employer, you must consult and inform all of your employees which may be affected by redundancy giving as much sufficient warning as possible, and be clear about the reasons for redundancy.
A fair redundancy procedure includes the requirement to consult with employees on an individual basis and this is required no matter how many redundancy dismissals are taking place.
Step 2- Fair selection pool
Where there are instances of only one employee affected by potential redundancy, a selection pool would not be necessary.
In all other cases, you should identify a pool of employees, where you can select those who are potentially going to be made redundant. Where there are employees who do similar jobs at a similar level, you should consider adding them to your possible ‘pool’.
Step 3- Redundancy selection criteria
Once a pool has been agreed, you should determine how many employees will be selected from that pool and reflect upon your business priorities in order to retain employees.
A dismissal will be automatically deemed unfair if the employee has been selected for an inadmissible reason, an employee will then be able to seek compensation at an Employment Tribunal.
We would recommend that you bring a draft version to show your employees of the criteria that you intend to use in a group consultation meeting, so they can have input.
Step 4- First individual consultation
Following the group meeting from the selection criteria, you will need to hold individual meetings with everyone in your selected pool. You need a two-way dialogue to find ways of avoiding the dismissal where possible, this may include job sharing, reduced hours etc.
Employees are entitled to know why they have been selected for redundancy and to see their selection scores. They are also entitled to be accompanied at the meeting.
As an employer, you must make a genuine effort to explore whether suitable alternative employment exists and if available should be offered during the course of the redundancy consultation process.
From here, you must create an outcome letter where you should respond to all points raised by the employee during the consultation, and invite them to the next consultation meeting.
Step 5 - Selection criteria scoring (if applicable)
After you have carried out your consultation meetings you would have gathered your feedback from your staff on both the redundancy situation and the selection criteria.
Having made any amendments that you think are necessary, you need to score each employee in the pool against the selection criteria.
Step 6 - Second consultation meeting
At the second meeting, you should run through how the individual scored and offer them the opportunity to comment.
Follow this meeting up in writing, responding to any suggestions or comments about their scores. The letter should also invite the employee to a consultation meeting, where the decision will be made on the dismissal.
Step 7 - Final consultation/dismissal meeting
This is the final meeting where you make your decision to issue the employee with notice of redundancy. Most points would be covered, but reflect back on previous discussions to justify your decision.
Before you make a final decision, ask your employee if they want to add anything else.
We would also recommend that you take a short break to make your decision, respond to points and issue a notice of redundancy.
Step 8- Follow up in writing
Following up from the meeting, you will need to confirm in writing that their post has been selected for redundancy, their dismissal and their leaving arrangements.
If you have any concerns or queries about the redundancy process, talk to our employment specialists today who will be happy to help.