Cutbacks in January, and no we are not talking about Dry January or no Carbs!
As 2024 starts, Channel 4 has hit the news as it proposes plans to cut jobs, putting 200 jobs at risk of redundancy.
When proposing redundancies this can be a difficult and lengthy process for employees and employers. Effective management of redundancies is crucial to avoid costly tribunal claim bills and maintain a strong workforce for the future.
What is a redundancy?
A redundancy can occur when:
- An employer has ceased or is due to cease to carry on business.
- An employer is closing down the workplace where an employee has been employed.
- The needs of the business for work that the employee has been doing has reduced or disappeared or is expected to do so.
- The need of the business for the number of employees to carry out work has reduced or disappeared or is expected to do so.
Consultations
If 20 or more redundancies are being proposed within a 90 day period under Trade Union and Labour Relations (Consolidation) Act 1992 collective consultations are required.
This involves consulting with appropriate trade union or employee representatives on issues such as:
- ways of avoiding redundancies
- how many redundancies are needed
- how employees will be selected for redundancy (selection pool)
- how employees will be scored against each other (selection criteria)
An employer should also be mindful that the decisions are objective and reasonable to be able to demonstrate that the process was fair, this can avoid claims of unfair dismissal and discrimination.
There’s no time span on how long consultations last, but there is a minimum period before you can dismiss any employees.
Secretary of State
It is crucial when proposing to make over 20 employees redundant that the Secretary of State is notified. Depending on how many employees you are proposing to dismiss this time frame could be:
- At least 30 days before the 1st redundancy takes place if dismissing 20 to 99 employees within a 90 day period
- At least 45 days before the 1st redundancy takes place if dismissing 100 employees or more within a 90 day period.
Protective award
If an employer fails to inform and consult collectively when dismissing 20 or more employees they could be faced with paying compensation of up to 90 days’ gross pay to each employee at an Employment Tribunal as a ‘Protective Award’. This is currently capped at a maximum weekly pay of £643 if you were made redundant on or after 6 April 2023.
It is important to note that ‘Protective Award’ claims are available for dismissed employees regardless of length of service. Consequently, employers can be faced with multiple claims of unfair dismissal and protective award if the redundancy consultation processes are not carried out correctly.
Overall, organisation and communication are a priority to help provide reassurance in an unsettling time for the business and employees.
We can provide you with a tool kit to assist you in undertaking redundancies and support you through the process to minimise the risk of tribunal claims.
For advice on the legal and HR steps to take in a redundancy process please contact us on 0333 888 1360 or complete the enquiry form and we’ll get back to you as soon as possible.
