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Employment law for businesses managing redundancies

Without proper management, making redundancies can be a painful and expensive time for any employer.

Employment law specialists can assist you with every step of the redundancy process, from calculating redundancy packages, to drafting compromise agreements, and First4lawyers has a team of experienced solicitors you can speak to.

Whatever your circumstances, you needn’t face the challenge of managing redundancy alone. First4lawyers are here to guide you through the process.

What is the process of managing redundancies?

If you are making redundancies at your place of work, the law requires that you follow statutory procedures that ensure the process is fair.

To be in compliance with UK employment law, you need to put an appropriate consultation in place and uphold certain responsibilities regarding your former employees’ future job prospects.

You must show that you have considered whether other suitable internal jobs were available for people who are being made redundant. If there were and you failed to offer one to that person, you could be taken to an employment tribunal for unfair dismissal.

If fewer than 20 people are being made redundant from a company, they must be consulted before the decision is made. If no consultation takes place, then the redundancy may be unfair – even if there is a genuine, valid reason for it.

If 20 or more people are being made redundant, this is known as a collective redundancy, and the consultation process for collective redundancies is more formal. It must involve a trade union if there is one, and if there isn’t then employee representatives must be consulted before the redundancy notices are issued.

If your employer has made you redundant without using a fair selection procedure, you may be able to claim for unfair dismissal and you may be entitled to compensation from an employment tribunal.

However, if you are offered an alternative job during the redundancy procedure and you turn it down, you may lose your right to redundancy pay.

What counts as discrimination when making redundancies?

The law prevents employers from making people redundant on the basis of their age, disability, gender, marriage status, pregnancy or maternity, race, religion, or sexual orientation.

As an employer, you must have a genuine need to make someone redundant. The method of selection must be fair and non-discriminatory. Employment tribunals will seek to ensure that no one is made redundant on the basis of discriminatory factors, and as an employer you would need to prove that there was a valid reason for making the redundancy, such as an employee’s poor disciplinary record.

Sometimes, discrimination can occur even when the reason for making redundancies is valid. For example, if an employer chose to make all employees who have worked at a company for six months or less redundant, this would be within the bounds of law. However, if that decision led to more young people being made redundant, there may be grounds to claim for unfair dismissal due to age discrimination.

Discrimination often occurs as a result of pregnancy or maternity leave. The Equality and Human Rights Commission provides a useful information guide to managing redundancy of employees who are pregnant or on maternity leave.

What is voluntary redundancy?

If jobs are being removed at a company, an employer might offer employees the option of voluntary redundancy.

An employee should still be consulted about voluntary redundancy, and if the employer doesn’t follow the necessary procedures, they may be in breach of employment law.

If you are an employer who has offered voluntary redundancy, it is still up to you who to select for redundancy once all volunteers have come forward.

I need legal advice around managing redundancies – what should I do?

If you are an employer and you require some help in managing redundancies, you can contact us to access the very best legal advice and assistance.

Our advisors will listen to your situation and then work out which of our top solicitors would be best for you to speak to.

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