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The three most common types of redundancy and three most common failings
Wednesday, June 24, 2020
Wednesday, June 24, 2020
The three main types of redundancy are as follows:
- The employer ceases to carry on business for which the employee was employed – typically the workstream in which the individual was working ceases to operate.
- The employer ceases to carry out work at the place where they employee was employed – typically the employer closes a factory or a unit or a shop. The fact the employee may have a mobility clause permitting the employer to move him or her around does not mean they escape redundancy. The relevance of a mobility clause tends to fall within the scenario of alternative employment being available elsewhere and whether or not that employment is suitable and the employee can be expected to move to it.
- The requirement for work of a particular kind ceases or diminishes. This is the usual headcount case where say an employer has seven machinists and decides it wishes to operate going forward with only five machinists.
Frequently employers mistakenly term a reorganisation as a redundancy. Please note a reorganisation where there is no reduction in headcount is not a redundancy. Employers may wish to reorganise the way they do work but without losing staff. A reorganisation without a reduction in headcount is not a redundancy. An individual who refuses to engage in the reorganisation and ultimately is dismissed for refusing to engage is not made redundant. They receive their notice pay and nothing more. This type of dismissal is known as SOSR.
Within the most common types of challenge, again there are three namely:
- The consultation is too late and inadequate. Typically the employer does not bother consulting until they have actually reached a decision and then try and hurry the redundancy through to get it over and done with. Consultation has to begin at the proposal stage, not the decision stage.
- Alternative work is available but for whatever reason, the employer does not offer it to the employee who is at risk. An employer should discuss any potential employment with any employee at risk. If a number of individuals expressed the wish to be considered for that work, then interview them competitively. Draw up selection criteria for the post, score the individuals. The successful candidate gets the post. The rest are redundant.
- The selection criteria and scoring are carried out badly. Typically subjective criteria with no measurable scoring mechanism which leads the individual to argue sometimes successfully that they have been targeted and the selection process is a sham. Later vlogs will deal with assessment criteria and scoring in more detail.
The best way of avoiding the three pitfalls is to check at each consultation meeting whether the individual has any concerns in those three areas. If the answer is no, it will be difficult for them to argue to the contrary later on.
Written by Robert Gibson, Senior Consultant - Employment Law
Robert is a Senior Consultant at Samuel Phillips and specialises in employment and business matters. He advises in relation to employment and shareholder disputes, including pensions and related issues.
