A recent survey of 2,097 British businesses carried out by YouGov on behalf of Acas found that 37 percent of employers are likely to make redundancies before the end of the year with this number increasing to 60 percent for large employers (those employing more than 250 employees).
The survey found that 27% of businesses making redundancies plan do this remotely via phone or video and 33% will use a mixture of both remote and face-to-face.
The survey also found that 24% of bosses are unaware of the law around consulting staff before making redundancies – this increases to 1 in 3 where businesses have fewer than 50 workers.
With the number of redundancies surging over recent weeks many employers and HR teams are having to get to grips with how to handle redundancies. Poorly handled redundancies mean that the employer is at risk of both reputational damage and also Employment Tribunal claims. Recent quarterly statistics from Employment Tribunals to June 2020 reveal an 18 percent increase in claims which is the highest level of increase since 2012/2013.Commenting on the figures the Ministry of Justice said the increase was likely due to rising levels of unemployment and changes in working conditions since the onset of the COVID-19 pandemic.
Employees who are dismissed by reason of redundancy are entitled to bring claims of unfair dismissal. Usually the employee would need at least 2 years of continuous service with the employer in order to be eligible to bring the claim. The Tribunal would look at whether there was a genuine redundancy situation and whether the employer acted reasonably in dismissing for redundancy. This includes:
- Whether the employer adopted objective selection criteria
- whether the employee was fairly selected for redundancy (including issues about “pooling” with other colleagues doing the same or similar work)
- whether there was consultation with the employee about ways in which a dismissal could be avoided including a consideration of suitable alternative employment.
There are sometimes difficult issues to consider including the effect of pregnancy, maternity leave, sickness absence and any personal health conditions.
Aside from unfair dismissal claims there can also be claims in respect of breaches of the collective consultation requirements where an employer proposes to dismiss as redundant 20 or more employees at one establishment within a period of 90 days. These claims can be very expensive. Businesses should therefore consider and plan very carefully any redundancies where these obligations may be triggered.
The key for any employer is sufficient planning, consultation and ultimately ensuring there is a fair reason for the redundancy.
Redundancy is a difficult process to navigate for many reasons and we can support you to ensure it goes as smoothly as possible.
For more information on the topic, please contact Lee Jefcott.
