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Redundancy checklist

If you need to think about making employees redundant there are a number of important considerations.

Is there an alternative?

  • Natural wastage
  • Restrictions on recruitment
  • Training and redeployment to other parts of the organisation
  • Reduction or elimination of overtime
  • Introduction of short-time working or temporary lay-offs (note: this must be part of a contract of employment or agreed via a variation in terms; see ACAS ‘Layoffs and short term working’)

What redundancy payment will you have to make?

Redundancy pay is due to employees with at least two years’ continuous service. The UK Government website offers help on calculating redundancy pay.

Have you checked the law on discrimination?

A redundancy dismissal may be found to be discriminatory under employment equality legislation where selection was on grounds of sex, marital status, race or disability, sexual orientation, age, religion or belief, or pregnancy/maternity. Dismissal may also be considered unfair where the reason or principal reason is redundancy but the circumstances apply equally to other employees who have not been selected.

Have you informed your employees about the possible redundancies?

To ensure employee representatives can play a useful part in the consultation process you must disclose certain information in writing including:

  • Reasons for the proposed redundancies
  • Numbers and descriptions of those affected
  • Proposed method of selecting the employees who may be dismissed
  • Proposed method of carrying out the dismissals taking account of any agreed procedure, including the period over which the dismissals are to take effect
  • How redundancy payments, other than the legal minimum, if applicable, will be calculated.

Have you consulted your employees abut proposed redundancies?

You have a duty to act fairly and reasonably in handling redundancies and informing and consulting affected employees individually. For more information see the ACAS guide Redundancy Handling.

Have you devised fair, objective selection criteria?

When selecting employees for redundancy choose precisely defined, objective criteria that can be applied independently. Basing your selection on skills or qualifications will help you to keep a balanced workforce appropriate to your practice’s future needs. You should also establish an appeals procedure.

Examples of such criteria:

  • Attendance record (ensure it is entirely accurate; that reasons for, and extent of, absence are known)
  • Disciplinary record (ensure it is entirely accurate)
  • Skills or experience
  • Standard of work performance
  • Aptitude for work
  • It is illegal to select an employee for redundancy on grounds relating to many issues, including: maternity rights; trade union membership; part-time and fixed term-working; and asserting a statutory employment right.

Have you helped your employees find other work?

  • Employees have the right to a reasonable amount of time off work to look for another job or to arrange training if they have been continuously employed for at least two years
  • Help employees find training or complete application forms and contact other local employers about employment opportunities
  • Larger organisations may offer counselling to help employees cope with the financial and emotional impact of redundancy.

Have you followed your redundancy procedure?

A redundancy procedure would normally contain details of all these areas:

  • An introductory statement of intent towards maintaining job security, wherever practicable
  • Details of the consultation arrangements with any trade union or employee representatives
  • The measures for minimising or avoiding compulsory redundancies 
  • General guidance on the selection criteria to be used where redundancy is unavoidable
  • Details of the severance terms, relocation expenses and hardship or appeals procedures 
  • The policy of helping redundant employees to obtain training or search for alternative work.

For free legal advice, contact CABA