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The Redundancy Process – a
quick recap
1. To constitute a genuine redundancy, a dismissal
of an employee must be wholly or mainly attributable to a business or
workplace closure or to a reduced requirement for employees to do work
of a particular kind.
2. The employer must follow a fair procedure and carry out adequate
consultation with the employee and consider alternative employment.
3. Where there is a group of employees doing similar work or their jobs
are interchangeable they should be included in an appropriate selection
pool.
4. Each employee in the selection pool should be scored according to
fair and objective criteria. Those with the lowest scores are then at
risk of redundancy. The criteria should be capable of independent
verification against performance reviews and attendance records etc.
5. Employers should carefully consider the appropriateness and relevance
of its selection criteria to the employees it will be used for and where
applicable, agree it with trade unions. Redundancies are often
challenged on the basis of the selection criteria used so employers
should ensure its selection criteria is applied in a consistent and fair
manner.
6. If there is a proposal to make 20 or more employees redundant at one
establishment within a 90-day period, the employer must carry out a
collective consultation. This includes informing and consulting employee
representatives and notifying the Department for Business, Enterprise
and Regulatory Reform. An employer’s failure to consult collectively
could lead to each affected employee being entitled to a payment
equating to up to 90 days’ gross pay.
7. SRP is only payable (by the employer) to employees who have two
years’ continuous employment. The redundancy payment due to each
employee under the statutory redundancy payment scheme depends on his or
her age and length of service (up to twenty years). This determines the
number of weeks pay due to the employee, which is then subject to a
limit on weekly pay (currently £380).
8. Some employees will, under the terms of their contract, have the
right to receive an enhanced redundancy payment which is generally
stated to include SRP. Whilst redundancy is a form of dismissal, if a
genuine redundancy situation does not exist, then an employee may have a
claim for unfair dismissal. Even if a genuine redundancy situation does
exist, an employee may still be able to claim unfair dismissal if the
consultation carried out by the employer was flawed or inadequate, if
their selection for redundancy was unfair or if the employer failed to
consider alternative employment.
Disclaimer
This article is copyright Sprecher Grier Halberstam LLP.2009 and should not be construed as legal advice or opinion in any specific facts or circumstances. The contents are intended for general information purposes only. You are urged to contact a suitably qualified lawyer for specific advice.
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