Funding reduction and redundancy

Many schools are currently facing the prospect of their funding being reduced in real terms by around 8% by 2019-20. For many employers, reducing headcount may become the last option available to save costs and streamline teaching. It is important that employers are carrying out a redundancy process in a full and fair manner to avoid the possibility of an unfair dismissal claim and a compensation award.

Redundancy covers where the needs of the business for employees to carry out work of a particular kind reduce or stop. This will cover situations where schools are planning on removing certain subjects or extracurricular activities as the work of the particular kind is being stopped. The employer will need to identify those at risk of redundancy, whether this is a single person or a pool of employees.

Where less than 20 redundancies are proposed at one establishment, usually classed as a single school, a meaningful consultation process needs to be carried out. Consultation involves meeting with affected employees, discussing the need for redundancies and seeking any alternatives to redundancy. Where more than 20 redundancies are proposed in a period of 90 days or less, a collective consultation process needs to be followed for at least 30 days before the first dismissal, or at least 45 days if 100 or more redundancies are proposed. Collective consultation will be carried out with representatives of the employees, usually a trade union or workplace representative.

If a redundancy situation is unavoidable, the employer will have to select the employees to be made redundant using objective criteria such as their skills, qualifications, performance at work, attendance and disciplinary record. Employers must also review whether there are suitable alternative job roles within the business for those who will be made redundant. Employees who accept an alternative role have a trial period of 4 weeks to determine if the role is suitable, during which they keep their right to receive a statutory redundancy pay.

If redundancy goes ahead, the employer should give the employees their correct notice of dismissal and pay notice pay, or make a payment in lieu of notice. Some employees will also be entitled to a statutory redundancy payment where they have at least two years continuous service. The amount of statutory redundancy pay depends on their age, length of employment and weekly pay at the time of their dismissal, subject to statutory caps. Failing to pay redundancy pay, or paying this wrong, could lead to a tribunal claim for a redundancy payment.

Lead Education Business Partner, Hussain Ahmed says “Whilst some employers feel they have no choice in making staff redundant, it is essential they are following a fair procedure to reduce the risk of unfair dismissal. Unfair dismissal claims carry high costs if they proceed to tribunal and could result in the financial situation of the business becoming more serious.”

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