As more firms wield the axe, what gives more staff consultation meaning? By Dominic Johnson
The debate on redundancy consultation sparked by recent high-profile closures such as Marks & Spencer (in France) and Motorola has generated more heat than light. Unions advance two arguments that these cases show the inadequacy of UK legal requirements - that UK law does not require meaningful consultation and that it is cheaper and easier to sack staff in the UK than in France or Germany. But neither claim stands up to scrutiny.
So what should meaningful and effective consultation be about? The CBI suggests three key objectives:
- To deliver a dialogue on proposed redundancies in which management explains and justifies its proposals and, where presented with compelling evidence, is willing to change them.
- To deliver discussion of the implementation of proposed redundancies, including where job losses will be made, how they will be undertaken and what redeployment and training opportunities may be available.
- To achieve open discussion with redundancy "survivors" on the implications of proposals for job security and workload.
Meaningful consultation is not about rights for employee representatives to substantially slow down or overturn management decisions. Rather, it is about management accepting that plans likely to affect staff fundamentally should be explained and scrutinised.
Companies do not make redundancy proposals lightly and it is unlikely that consultation will throw up such startling evidence that will make management rethink its plans. But it is central to the idea of meaningful consultation that this possibility exists.
The Collective Redundancies Regulations require precisely this kind of approach. Consultation must focus not just on the timing and implementation of proposals but on the substance of decisions leading to redundancies in the first place. Proposals must be tabled while they are at a "formative stage", including an examination of whether redundancies are necessary, ways to reduce the number of dismissals and ways to mitigate the consequences of dismissal (such as retraining).
These requirements are backed by stiff penalties if companies get it wrong. Ninety days' pay for each affected employee - not just those who are facing dismissal - focuses the mind.
What about the impact of red