Redundancy: What An Employer Needs To Know

GDaly

Gerry Daly is the Employment Law Partner in Francis Hanna & Co Solicitors with almost 40 years experience in this field.
In his guest blog for Life Law NI, he has set out some of the factors that employers need to consider when dealing with possible redundancies within their business
As many of you already know and others are unfortunately going to find out in the current economic climate, downsizing your business and considering redundancies is a prospect you may have to face.
This is a grim prospect for you as a business owner but more particularly for your affected employees.
It is therefore vital that you as an employer handle this process fairly and in a manner that protects you from any potential unfair dismissal claims made by your employees.

What do I need to look at when considering redundancies?

When handling redundancies, you will be deemed to be acting fairly both morally and legally if you treat the matter with ‘RESPECT’, that is;-

R = Redundancy

You must be able to show that a genuine redundancy situation exists in your business

E = Employees

You should ensure that your employees are fully consulted about the redundancy situation.

S = Selection

You must use objective and verifiable criteria when you are considering which roles are to be made redundant

P = Procedure

You should follow the 3 step dismissal procedure:-

  1. Inform the employee in writing of the circumstances which are leading to you considering redundancies, invite them to a meeting to discuss the matter and warn them that a possible outcome is dismissal.
  2. Hold a meeting with the employee to discuss the proposed redundancies. An outcome of the meeting must be provided and your employee must be informed of their right of appeal.
  3. If your employee chooses to exercise the right of appeal, an appeal hearing must be held and a final decision provided
E = Employment

You should consider whether there are any alternative job roles that could be filled by those being made redundant in order to avoid the redundancy.

C = Calculation

You need to ensure that the correct redundancy payment is calculated

T = Termination

You must ensure that a letter is sent to the employee confirming the end of their employment

The underlying legal principle when considering redundancies is that of reasonableness – i.e. have you as an employer behaved reasonably in all of the circumstances towards your employee when handling their redundancy?

Before embarking on this process you should ask yourself whether you need independent legal advice.
My recommendation is that you should instruct an employment lawyer to handle the process. This will ensure that it is handled objectively and not contaminated with emotion which could end up costing you dearly.

Gerry Daly

Francis Hanna & Co Solicitors

If you wish to contact Gerry for more information on this area, please contact him at gdaly@fhanna.co.uk or alternatively let us have your comments below.