How to handle a redundancy consultation
How to make sure you on solid legal ground
If you haven’t already, you should inform the employees what is going on. You should outline why the redundancies are necessary, in which category they will fall and the procedure that will be followed to select them. You should specify the time period for the process as well.
It can be difficult to decide whether to tell all your employees or simply those affected. Lynda Harrison of law firm Berg & Co .suggests, “The nature of businesses is such that whole workforce will get to know anyway, whatever you do. So generally speaking, it’s better to make a general announcement and then set up meetings with those affected. This will ensure the process is transparent.”
When you tell the pool, you might consider asking if anyone would like to volunteer for redundancy. If someone steps forward it will avoid upsetting other employees and it might have the advantage of encouraging an unhappy employee to leave. However, make sure it doesn’t backfire on you.
“The difficulty that sometimes arises is that the people who volunteer have the skills the company wants to retain. It is often worth saying that application for voluntary redundancy is at the company’s discretion,” advises Harrison.
Making the selection
Once the pool has been informed you can make the selection. Apply the criteria consistently to each member of staff in the pool, documenting how you arrive at your final selection.
The next thing to think about is whether you can offer the people selected a position anywhere else in your business. If a vacancy is likely to appear in the future, consider delaying the redundancy until that time.
If you offer an alternative position, the job should be similar in skills, pay, benefits and working conditions. “Even then, the employee may have a good reason to turn it down, for example if it is located in a different town,” explains Phillip Millington of Osborne Clarke. “However, if the employee unreasonably rejects the job you have offered, they may lose their right to redundancy payment.”
During consultations, explain to each employee:
- why the job is being made redundant
- the selection criteria that was used
- the timing of the redundancies
- the likely amount of redundancy payment
- any alternative positions that might be available
Make it clear that the final decision has not yet been made. You should then give the employees at least couple of days and preferably longer to think about what they have been told. The employees will then return and have an opportunity to challenge their selection or propose alternatives to redundancy.
Discuss and give due consideration to any proposals the employee makes, but remember that consultation doesn’t have to end in agreement. At the end of the process, if you have failed to come up with an alternative solution you can confirm the decision and issue a dismissal notice.
Breaking it to the employee
Being made redundant is a traumatic experience for any employee and must be handled sensitively. Try not to be too blunt or too vague, and fully discuss every aspect. You may not be experienced in these matters, so preparation is important.
“A lot of managers have had no training of any kind,” explains Elsey. “It might be a good idea, if not to get some training, to at least read a book about it. Work out what you’re going to say beforehand and make notes of the meeting to file, just in case.”
There is much you can do to help the employee find another job, such as give time off to attend interviews, use your contacts to find vacancies and write references. Large companies often bring people in to help employees with their CV and job search – something you could do yourself if you have the skills. However much you try to help, though, it is unlikely to be an easy process.
“The fact is that you just don’t know what will happen. They may just have taken out a mortgage, for example, so be prepared for all eventualities and have a box of tissues just in case.”