Redundancies are always a difficult decision in any business. Whilst it can be possible to reduce staff by offering the option of voluntary redundancies, it’s not always as straight forward as it might seem to reduce your employee numbers.
When thinking about redundancies ensure your business is set up to survive by thinking carefully about who will be left. Always use an objectified and documented process to ensure your redundancies are compliant with Employment Law Regulations.
Here at Castle Associates, the employment law specialists, we recommend the following steps:
Identify if and where cuts need to be made in the business
Invariably, where one part of a business is quiet, another will be busy. If one part of the business is busy enough to hire, think about retraining and upskilling employees who would otherwise be candidates for redundancy.
However, if business is generally quiet and there are clear grounds to reduce the workforce, then it’s easy to make the judgement call. Remember to think how you will cover sickness absence, annual leave and so on after people leave – overworking the remaining staff could create future mental health issues.
Define the criteria for redundancy
Choosing who to terminate is incredibly difficult, however best practice dictates that an employer should be able to show an objective process has been followed – and therefore you should focus on only those criteria which you can prove.
Think about factors like:
Transferable skills (e.g. some employees may be trained to perform more than one role, whereas others may only be able to do a single job and could not easily reskill)
Culture fit and team relationships
Performance in current role (ideally assessed using a 360-degree performance review)
Aptitude for the role
Aptitude for the role
You cannot base a redundancy decision on any of the protected characteristics, e.g. disability, (including that of a dependent child or partner), pregnancy, maternity, mental health, gender, sexuality, religion and so on.
Be careful, too, with sickness absence. If absence is due to a disability, such as epilepsy, asthma or a long-term mental health condition, you could be guilty of disability discrimination.
Keep clear records
When making people redundant, it is important to keep accurate notes, documenting the redundancy selection process, how the settlement was reached and so on. If the employee decides to bring action at a later date, access to a full audit trail will help you defend any claim.
Calculating Redundancy Pay
There are several free redundancy calculators online, but we advise you seek legal advice – a quick consultation to check settlements with your employment law solicitor is trivial compared to the costs of defending a claim.
If you are thinking about making redundancies in your firm, our Employment Law team are on hand to ensure that any redundancies you make are demonstrably fair and legal.
Castle Associates is here to help you through every stage of the redundancy process. Our dedicated specialist team will be there to support you, your staff and ensure that process is conducted fairly and in compliance with the law.