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If you need legal advice, whether as employer or employee, on any aspect of redundancy law, contact our employment lawyers. We offer practical and cost effective legal advice in this area.
Redundancy situations are extremely difficult for both employer and employee, involving considerations of fairness, procedure, notice, redundancy law, and sometimes tax on redundancy payments. The term redundancy often covers a multitude of different situations and can also include voluntary redundancy.
Many employers believe that a policy of “last in first out” is both an acceptable and fair way to deal with redundancies. Redundancy is no different, in essence, from other forms of fair or potentially unfair dismissals – the legal test is based on the employer acting within a “range of reasonable responses”. Having said this, last in first out will rarely be a safe approach.
Generally speaking, the best approach by employers is to factor in a number of different criteria, performance and otherwise, and to ensure that the methodology is clearly documented. It is also vital for employers to actively consult with employees who are at risk and to give the employee an opportunity to put forward alternatives to redundancy.
The redundancy process
To remain fair the redundancy must also be procedurally correct which involves the use of appropriate selection criteria, identification of the selection pool, due consultation, adherence to relevant contractual matters and an overriding requirement that the redundancy is proven to be genuine.
The bigger the employer the more the Employment Tribunal will expect of that employer. However, turning this around, a very small employer shouldn’t assume they can overlook carrying out a fair process. The burden on larger employers is perhaps best viewed as requiring such an employer to go to extra lengths to look at alternatives.
With redundancy situations, the employee will only be able to claim unfair dismissal if he or she has the requisite period of continuous employment, which is now 2 years. However, the position is not as straightforward as this and even if an employee does not have sufficient continuity of employment, if he or she are unfairly or arbitrarily selected they may claim that the decision was based on discrimination, either race, sex, disability, age or religion and there is no qualifying period for making a discrimination claim.
We advise many employers on how to safely navigate the legal and procedural minefield of redundancy. Good redundancy solicitors can save you a lot of stress, time and money. Get in touch to find out how we can assist you.