The rates of redundancies have been high between 2020 and 2022 due to the arrival of COVID-19; it has forced many businesses to take the hardest decisions to ensure their own survival.
The statutory definition of “redundancy” encompasses three different types of situation:
In order to ensure that a dismissal for redundancy is fair, an employer must establish that Redundancy is the real reason for the dismissal and that the employer acted reasonably in the circumstances in treating redundancy as the reason for dismissing the employee.
Redundancy should only be considered as a last resort, and there is a duty on the employer to consider all other options prior to making redundancies. Initial considerations that the employer should contemplate include:
Where 20 or more employees are being made redundant over a period of 90 days or less, an employer has a duty under the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) to:
A tribunal may award up to 90 days’ pay in respect of each employee where there has been a breach of the information and consultation duty (also called a protective award). An employer may be fined if it fails to notify the Secretary of State.
Whenever there is an obligation to consult collectively, the employer will also need to ensure that it has followed a fair procedure in relation to individuals, including consulting with them properly, so as to minimise claims for unfair dismissal.
A tribunal must consider whether the decision to dismiss an employee was within the range of conduct that a reasonable employer could have adopted.
Case law has established that an employer will normally not act reasonably (and a dismissal will therefore be unfair) unless the employer:
When considering the fairness of any dismissal for redundancy, consultation with employees prior can be fundamental. A number of matters should be discussed with individual employees depending on the circumstances, but usually the discussion should include the following:
Regardless of the nature of the process, redundancies are very stressful for the individuals involved, especially the employees. It is extremely key that any employer who is planning to start a redundancy process takes sufficient time to plan and make sure that the necessary steps are taken.
Should any steps be skipped or should an employer make an errors, they may be setting an employee up for a strong unfair dismissal claim due to lawful redundancy breach.
More information about redundancy can be found in our FAQ here.
If you feel that you have been unfairly made redundant or if you’re an employer looking for assistance in dealing with the process correctly, please do not hesitate to get in touch with us on 0113 200 9720.
Meet the author
Daryl Ross Smith joined Oakwood Solicitors as a Paralegal in October 2018. Daryl finished his degree in Forensic Science at Northumbria University, before completing the GDL and the LPC LLM at the Uni…
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