The process to be followed will depend on the scale of the redundancy, as this will affect the timelines involved and the obligations of employer.
1. Create a strong business case for the redundancy
It is vital in a redundancy process to create a business case and establish the reasons why redundancies are being made. The business case can also be the first step to analysing which group of people will be affected by the redundancy.
2. Look for alternatives
An important step in carrying out a fair redundancy process is to consider every alternative to redundancy beforehand, such as layoff, pay reductions or transferring employees to alternative roles. Without consideration of alternatives, it is likely that the redundancy procedure could be deemed to be unfair.
3. Carry out consultation with affected staff
Consultation needs to be carried out in order for the redundancy to be deemed fair. The consultation obligations for an employer vary dependent on the number of redundancies proposed and there may be minimum time periods involved. In some circumstances, employees are entitled to hold elections to choose the person who will act as representative of the group to take part in consultation.
4. Select employees for redundancies
Employees should be fairly selected for redundancy based on objective criteria such as their skills and qualifications, standards of work and disciplinary record. Criteria such as attendance or length of service can be used – though in some circumstances this can be discriminatory.
5. Finalise process
Once employees are selected, they should be given notice of their redundancy and given the right to appeal the decision. Redundant employees are entitled to notice pay, based on the length of their notice period, and may be eligible for statutory redundancy pay if they have at least two years continuous service.