As the UK starts to open up again and with warnings from the Government to expect some sort of recession... Do you know what's needed of you and your business, if you need to make people redundant?

If you are in this rather unfortunate position, doing this the right way is more important than ever, not doing it correctly will cost you even more money!

In my opinion, transparency is EVERYTHING!!! Who knows, your team may have some ideas to support your business that you've not thought off... So communication has to be a two way street if this is going to work.

As an employer, don't hide and do the minimum, be open and be honest about your entire situation!

Below are the basic steps to take for employers:

Step 1: Warn people of the potential of redundancy

You must warn all your employees of a potential redundancy situation and that it may affect them. This is also a good point to talk to your teams about any ideas that they might have for preventing any redundancies.

Step 2: Identify the redundancy pool

If you are shutting down a workplace, selection is not an issue.

However, in other redundancy situations, you may need to identify the redundancy pool from which to select those employees who may be potentially made redundant. The pool should include individuals who are undertaking the same or similar work duties or who provide cover for each other, or whose skills are interchangeable.

It might also pay you to look at voluntary redundancies, as they can be a real life line in some cases.

Step 3: Decide on the selection criteria

You should create a scoring criteria – employee(s) in the pool will receive scores against this list and the employee/s with the lowest score will be selected for redundancy.

All the criteria you use must be fair, objective and non-discriminatory. Examples of such criteria are attendance record, disciplinary records, skills, experience and work performance. Be sure not to lose any business critical skills, as one the selection has been made, its too late!

Any records you use must be fully accurate and up-to-date.

Be careful when considering:

• Length of service – Make sure that you are not discriminating on the basis of age, for example, as it is likely that this will disproportionately affect more young people who may not have worked for you too long.
• Absence record – Absences due to maternity leave, pregnancy and disability should not be taken into account.

Remember, you may decide to give a different weighting to different criteria depending on what you most value and need for your business.

You cannot select people for redundancy based on a discriminatory reason as this would give rise to a discrimination claim and is likely to make the dismissal unfair, with the employee being able to seek compensation in an Employment Tribunal.

You cannot select an employee based on their age, gender, marital status, sexual orientation, race, disability, religion, belief, or gender reassignment. You cannot select them for being pregnant, being on maternity leave or paternity leave or exercising any of their statutory rights. Likewise, it is not permissible to select them for whistleblowing, being a part-time employee or being a member of a trade union.

Step 4: Consult with employees as a group

You must meet with all the employees in the redundancy pool and explain the reasons for the redundancies; how many jobs are at risk; why they are in the pool; the selection criteria; and the alternatives you are considering to dismissal. You should ask them if they have any suggestions to avoid redundancies and if there are any requests for voluntary redundancy.

It is essential to confirm what was discussed in the meeting in writing.

Step 5: Apply the selection criteria

You should score all the employees in the pool, ensuring that you are fair and consistent when applying the criteria. If possible, try to have more than one person involved to make the process as objective as possible.

Make sure you keep written records of the individual employee assessments.

Step 6: Consult with employees individually

You must write to all the employees who have been provisionally selected for redundancy, inviting them to a meeting. They are permitted to be accompanied by a trade union representative or colleague.

You must consult with each employee individually and discuss their scores, the proposal to select them for redundancy and all opportunities for alternative employment. If an employee unreasonably refuses to accept a suitable alternative employment you offer, they may lose their right to statutory redundancy pay.

After the meeting, you should take action on any proposals to prevent redundancies, consider any employee representations or challenges to scores and think about alternative employment options.

Step 7: Dismiss the employee

If you decide to make someone redundant, after considering all alternative options, you should invite the employee in question to another meeting and clearly explain your decision, explain their redundancy package and their right to take time off work to seek alternative employment.

You should write to the employee to confirm their dismissal, clearly stating their termination date. You may either pay the required amount of notice or make a payment in lieu.

You must offer the employee the right of appeal.

Paying employees statutory redundancy pay

An employee has the right to statutory redundancy pay if they have worked for you for two years or more. The amount they receive will depend on their age and their length of service, be sure to check the correct and current rate against up to date Government guidance!

Some employers may provide their employees with a contractual right to enhanced redundancy payments.

Things to remember when it comes to redundancy:

• Different procedures apply for small-scale/individual redundancies than in collective redundancies (20 redundancies in a 90 day period).
• In individual consultation cases, there’s no time limit for how long the period of consultation should be, but it should be long enough for meaningful consultation to take place.
• An employee who will have two years’ service by the termination date and who is working their notice for redundancy is entitled to reasonable time off to look for another job.

If you need support please give Process & People a call or drop a message in our inbox: [email protected]

Remember, it costs nothing to talk!