Navigating Redundancy: Guide for Employers image of a woman talking to two other women on each side of the table

Navigating Redundancy: Guide for Employers

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Written by: SafeWorkforce
8th June

Today we wanted to provide you with a redundancy guide article to help you as an employer. An employee is dismissed by reason of redundancy if the circumstances of their dismissal fall within the definition of redundancy set out in s.139 of the Employment Rights Act 1996.

These are 5 key steps businesses are expected to follow during a redundancy procedure:

Redundancy Guide: 5 Key Steps

Stage 1: Preparation

  • Assess whether a redundancy is necessary
  • Identify your time frame to complete the disciplinaries
  • Prepare the appropriate documentation

Stage 2: Selection

  • Select the pool of people under consideration for redundancy
  • Determine the criteria you’ll to select the individuals

Remember: It needs to be fair and applied equally

Stage 3: Consultation

  • In your consultation with the employee you should explain
  • The risk of redundancy and the reason why
  • How many redundancies you’re considering
  • If there are alternative employment opportunities
  • Next steps and how they’ll be consulted
  • You should also confirm what was said in writing to the employee

Stage 4: Notice

  • Write to the employee to inform them of the dismissal
  • Explain that they have the right to appeal

Stage 5: Termination

  • Employee with 2+ years’ service qualifies for statutory redundancy payments
  • Provide employees with a written record of how the payment is calculated

Remember: Communication is key and will help ensure your redundancy is fair

Important insights in this Redundancy Guide

Statutory Rights During a Redundancy

The following is the statutory rights that employees and employers have during a redundancy:

Family friendly leave

An employee who is made redundant while on maternity, adoption, or shared parental leave is entitled to be offered suitable alternative employment in preference to other employees.

The right to paid leave

An employee who has been given notice of dismissal by reason of redundancy is entitled

to a reasonable amount of paid time off work before the end of their notice period to search for new employment.

Redundancy payments

An employee is entitled to a statutory redundancy payment if they:

  • are an employee;
  • have been continuously employed for not less than two years;
  • have been dismissed; and
  • were dismissed by reason of redundancy.

Exclusion of redundancy payments

An employee is not entitled to statutory redundancy pay if:

  • You employ them in a different role
  • The employee refuses the suitable alternative role without a good reason

How can SafeWorkforce help?

We can support by advising you through the various steps to take, provide HR Guides and the relevant template letters and documents you need. We can also explore alternatives to redundancy that we might identify during the call. We appreciate that due to current cost of living crisis, many employers are struggling with rising energy costs etc. but given the time and cost of making redundancies (redundancy pay, notice, holiday etc.), exploring alternatives first is sensible.

It is important you follow the correct steps otherwise you run the risks highlighted above. If a matter did end up at tribunal, there is not only the cost of legal representation and compensation if you were to lose the case but also the management time preparing and attending as witnesses.

Book a chat today

  • Specialist guidance from our experts.
  • Reducing the risks, costs, time and effort it takes to implement a robust health and safety management system.
  • Support with human resource process' and procedures to save time and increase efficiency.
  • A tailored approach that suits your business.

To speak to a member of the team, get in touch on 01484 439 930 opt.1 or make an enquiry.