How do we decide who to put at risk of redundancy?

If you are faced with having to make redundancies in your business, you will need to consider your redundancy pool and your selection criteria.  Our Employment Law team explains here who should form your redundancy pool, what factors should form your selection criteria, and how to ensure it is a fair procedure for all concerned.

The first step is to ask for volunteers before making compulsory redundancies and this usually forms part of a fair procedure.

What is a redundancy pool?

The next formal stage is for a redundancy pool to be formed which is a group of employees from which redundant staff will be selected. Each pool usually includes employees at risk of redundancy who currently perform the same or similar roles or will do so after the redundancy procedure, if not made redundant. You may need a few different redundancy pools for different business departments depending on the types of issues which have led to the redundancy situation. Choosing the redundancy pool has a subjective element and there is no single right approach, but you must act reasonably and take care to avoid discrimination.

You can use selection criteria to help decide who to make redundant within this pool, but this must be fair and not discriminate against those with a protected characteristic, such as race, gender, age etc. The best way ensure that the selection criteria are fair is to review more than one criteria and apply the criteria equally to all staff in the selection pool. Criteria should have evidence to illustrate the scores attached to them. The criteria often include:

• Performance
• Length of service
• Qualifications and training
• Attendance record
• Time-keeping
• Disciplinary record.

You should also hold several meetings with employees who are at risk of redundancy to discuss the situation and allow them to put forward ideas to avoid making redundancies, alternative vacancies, job shares, the selection criteria and any other concerns they may have.  This is known as the consultation period.

You should also consider and put forward any suitable alternative roles for the employee. 

At the end of the consultation period, you will need to confirm whether you are making an employee redundant.

If 20 or more employees will be made redundant within a 90-day period then collective consultation should also take place in addition to individual consultation and there are set time limits for the length of the consultation period.

In any redundancy situation, it is crucial that you conduct your consultation fairly to avoid potential tribunal claims being brought against you.  We would always recommend that you seek legal advice before proceeding, as there may be other options for you other than redundancy.  We have been advising employers for many years on the complexities of redundancies, and can advise you not only on the legalities but also on the practicalities of holding those difficult conversations with your employees.  Contact us today on 023 8071 7717 or email employment@warnergoodman.co.uk to discuss your situation further.

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ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice. All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.