November 18, 2010
In these difficult economic times, large scale redundancies can be inevitable and some well known Banbury businesses have already been affected. The law respects that tough decisions need to be made, but requires that fair procedures are followed to protect the employees affected by these important decisions.
A collective redundancy situation arises where an employer is proposing to dismiss as redundant at least 20 employees at an establishment within a period of 90 days or less. The employer is required to send written notification to the Department of Business, Innovation and Skills (“BIS”) and their website gives important information for businesses in these circumstances.
The employer is required to consult about the dismissals with appropriate representatives of the affected employees. Where none exist, the employer must invite the employees to nominate representatives and hold elections. All employees who will be affected by the redundancies should be included in the election and the subsequent consultation, including those who will not actually lose their jobs, but who might, for example, be required to relocate.
The employer is the actual company which employs the affected staff, even where the decision to make the redundancies has been made by a parent company. Consultations must be completed before individuals are given notices of dismissal.
Where at least 20 employees are to be dismissed, consultation must begin at least 30 days before the first of the dismissals takes effect, which increases to a 90 day period where the proposal is to dismiss at least 100 employees.
The employer is required to try to reach agreement with the appropriate representatives and should consider whether the dismissals can be avoided or reduced. A fair redundancy process in all cases requires an employer to consider whether employees can be offered a reasonable alternative position.
Where an employer fails in its consultation requirements, it can face claims by the employees and by the appropriate representatives for “protective awards” of up to 90 days uncapped pay per affected employee, as well as the usual unfair dismissal claim.
For more information on this or other employment matters, please contact Debra Wetters, Solicitor at Spratt Endicott Solicitors on 01295 204000 or email her on dwetters@se-law.co.uk
