This is a framework document that your Company could adopt as it’s policy on this matter: –
It is the policy of the Company to maintain as secure an employment environment as possible, and by means of effective financial and staff planning and management to avoid situations requiring redundancies.
The Company undertakes to consult with recognised trade unions and employee representatives at the earliest practical opportunity when it believes that redundancies are envisaged or restructuring is being considered.
This procedure is designed to provide a framework for those consultations, recognising that different situations will sometimes require different solutions, whilst ensuring that the Company complies with statutory requirements and best practice. (In accordance with the ACAS Code of Practice and Guidelines).
All employees will be encouraged to recognise the changing environment in the work place which may require them to be flexible and open to change and new opportunities.
While the Company will try to avoid redundancies, employees are asked to share this responsibility by being as receptive to change as possible.
Disclosure of Information
Managers have a statutory duty to disclose in writing to recognised trade unions the following information concerning proposals for redundancies so that they can play a constructive part in the consultation and negotiation process: –
- The reasons for the proposals
- The number and descriptions of employees it is proposed to dismiss as redundant
- The total number of employees of any such description employed
- It is essential that the relevant Trades Unions are consulted and involved with regard to how employees are to be selected for redundancy
- How the dismissals are to be carried out, taking account of any agreed procedure, including the time scale over which the dismissals are to take effect
The information must be handed to a local representative of the union who is authorised to carry on collective bargaining as well as sent by post to an address notified by the union, or to its head office. Managers must consider any points made to them by the union representatives and give reasons if any point is rejected.
In addition to the good employee relations benefits of consultation, employers who recognize independent trade unions have a statutory duty to consult them at the earliest opportunity once redundancies are proposed. This duty applies even when only one person is to be made redundant and even when employees have volunteered for redundancy, irrespective of whether or not they are members of the recognised trade union. Failure to consult could lead to a claim for compensation, known as a protective award. Consultation should take place at the earliest opportunity regardless of how many employees are to be dismissed. Current legislation requires that consultation must in any event begin: –
- At least 30 days before the first dismissal takes effect if between 20 and 99 employees are to be made redundant at one establishment over a period of 30 days or less.
- At least 45 days before the first dismissal takes effect if 100 or more employees are to be made redundant at one establishment over a period of 90 days or less. Managers also have a statutory duty to notify the Department of Employment when they intend to make redundancies, and the Director of Human Resources should be involved at the earliest point in any redundancy proposals to ensure that the appropriate paperwork is completed.
These statutory requirements are minimum periods only and managers are required to consult fully with appropriate trade unions or employee representatives as soon as practicable, and should not do so until the matter has been fully discussed with the Director of Human Resources. The consultation process should precede any public announcement of the redundancy program and the issue of notices of termination. The individual periods of notice due to employees to be made redundant may run concurrently with the statutory minimum consultation period.
Before deciding on a course of action managers need to carefully consider –
- employee relations implications
- long term implications
- other alternatives
- time scale
Having considered the above should managers still wish to proceed with the organizational change or restructuring then the Director of Human Resources must be involved before any further action takes place.
Good Practice in Consultation
In addition to those areas outlined above and in the interests of good employee relations, matters on which managers may seek to consult and, where appropriate, negotiate will usually cover: –
- The effect on earnings where transfer or down-grading is offered in preference to redundancy.
- How the selection of employees for redundancy will be applied – for example, will it be appropriate for selection to operate across the working group as a whole or on a departmental basis?
- Whether a redundant employee may leave during the notice period, or postpone the date of expiry of notice, without losing any entitlement to a statutory redundancy payment.
- Any extension of the length of the statutory trial period in a new job.
- Pensions and entitlements.
Reductions in Staffing Levels
Where it is determined that employee reductions should be made, it will first be necessary to determine which employees are affected. Consultation and negotiation will take place on the possible courses of action designed to reduce staffing levels and thereby avoid redundancy.
These will include: –
- Restrictions on recruitment which is relevant to the affected posts.
- Non-filling of vacancies, permitting a gradual reduction by natural wastage.
- Reduction or elimination where practical of overtime working.
- The termination where practical of the employment of temporary staff.
- The retraining and redeployment where appropriate of existing staff into internal vacancies which currently exist.
- Seeking applicants for voluntary redundancy.
- The retirement of staff who are beyond the normal retirement age.
To assist in consultation it may be necessary as a preliminary stage to discuss with individual employees their personal preferences.
Managers will be required to be as flexible as possible to minimise the number of redundancies and aid redeployment. The precise method will be determined after consultation in each circumstance. It is recognised that retraining may be necessary to facilitate redeployment and this will be provided wherever possible. Where redeployment results in appoint to a lower paid role, protection of earnings will be dependant upon whether or not the new role is suitable alternative employment or not.
Consultation with individuals
Managers should ensure that employees are made aware of the contents of any agreed procedure and of the opportunities available for consultation and for making representations. Case law has shown that dismissals have been found to be unfair where the union has been consulted but not the individual. It is therefore essential that individuals who are to be made redundant are consulted, whether or not they are members of the recognised trade union. Where individual employees are so consulted, they are more likely to react in a constructive way and may perhaps be able to suggest alternatives to redundancy.
Compulsory redundancies will only be considered as a last resort where the above measures have failed to produce sufficient reductions in manpower levels. Should this situation arise further consultation will take place at the earliest possible opportunity, and wherever possible in excess of the minimum statutory periods.
The following information will be provided to the Trade Unions or employee representatives at the beginning of this consultation period: –
- the reasons for the redundancy proposals
- the number of employees who are expected to be affected
- the total number of employees in the business unit concerned
- the proposed criteria to be used for selecting the employees affected
- the proposed method of carrying out the redundancies and the period over which the redundancies are to take effect
Following consultation and negotiation and taking into account the representations made by recognised trade unions, the Company will determine which employees will be made redundant according to fair and consistent criteria. All decisions will be made in accordance with the Company’s Equal Opportunities Policy. Employees who will be declared redundant should be given as much notice as possible and if practicable in excess of that required in their individual contracts of employment.
Redeployment Selection Criteria
Only employees under threat of redundancy will be considered for any vacant roles in the first instance.
Offers of suitable alternative employment
Managers must consult with the Director of Human Resources to ensure that any suitable vacancies within the Group are offered to employees affected by redundancy in the first instance. Where alternative work is available, employees should be given sufficient details to enable them to decide whether to accept or not. Whether alternative work may be considered suitable depends on a number of factors, including the following: –
- Working environment
- Hours of work
- Place of work
- Skills and experience required
The offer should show how the new employment differs from the old and by law must be made before the employment under the previous contract ends. The offer must be for the new job to start either immediately after the end of the old job or after an interval of not more than four weeks.
An individual who is under notice of redundancy has a statutory right to a trial period of four weeks in an alternative job where the provisions of the new contract differ from the original contract, the period to begin when the previous contract has ended. The four week trial period can be extended for retraining purposes by an agreement which is in writing, specifies the date on which the trial period ends and sets out the employee’s terms and conditions after it ends. If the individual works beyond the end of the four week period or the jointly agreed extended period any redundancy entitlement will be lost because the individual will be deemed to have accepted the new employment. If the individual is not happy further trial periods may be arranged in alternative posts. There are no limits to the number of trial periods. The manager should also use the trial period to assess the person’s suitability. Should the manager wish to end the new contract within the four weeks for a reason connected with the new job, the individual will preserve the right to a redundancy payment under the old contract. If the dismissal was due to a reason unconnected with redundancy, the individual may lose that entitlement.
Time off to look for new work or for training
Employees will be given as much assistance as possible to find new employment or training for new employment and will be permitted all reasonable time off during working hours to seek alternative work or training as provided for by Section 31 of the Employment Protection (Consolidation) Act 1978.
Unfair Selection for Redundancy
The dismissal of an employee selected for redundancy will be unfair if it is for one of the following reasons: –
- The selection is in breach of a customary arrangement or agreed procedure unless there are special reasons to justify departure from it, or
- The selection is for a trade union reasons, or
- Where an individual on maternity leave has the right to return to work but is unable to exercise that right due to reasons of redundancy, she is entitled to be offered suitable alternative employment where a vacancy exists
- Part-timers should be treated equally to full-timers as they have the same statutory employment rights.
Furthermore, dismissal may also be considered unfair where the reason or principal reason is redundancy but the circumstances apply equally to other employees who have not been selected.
TUPE provides that where there is a transfer of an undertaking (or part of one) the new employer takes over the contracts of employment of all the employees who were employed in the undertaking at the time of transfer and that these employees transfer on the same terms and conditions as they had with their previous employer, except in relation to occupational pensions. Where an employee objects to such a transfer, he or she will be deemed to have resigned.
Where an individual considers they have been treated unfairly they should raise the matter through use of the Company’s Grievance Procedure.