Legal Q&A: Redundancy matrix

Due to the economic downturn, many employers are having to lay off staff – sometimes in large numbers. This is a painful process, but it is important to get it right. One tried and tested method is to use a redundancy selection criteria matrix. But care must be taken to ensure that the criteria used and the weight given to them do not put employers at risk of legal action.

Q Are employers bound by a set of selection criteria that they have to use when considering redundancy?

A Fortunately, employers have a free hand in setting the selection criteria they want to use. As long as the criteria are measurable and applied fairly, then a tribunal is unlikely to interfere. Employers should make sure they include relevant and measurable selection criteria such as absence and sickness records, skills, productivity and disciplinary records. Using objectively measurable selection criteria reduces the risk of any subsequent discrimination claims. It is worth noting that when scoring on criteria such as absences, employers must be careful not to count absences that might be connected to a disability suffered or claimed by the employee, or are connected with a reason such as pregnancy. If you do, this could lead to a claim of discrimination, as well as unfair selection for redundancy.

Q In what circumstances can a selection criteria matrix be used?

A You should only use a selection criteria matrix where there is more than one candidate for a redundant post. This forces on you the necessity of choosing the candidate for redundancy from a pool of relevant employees.

Q Should sickness and time-keeping records form part of the selection criteria?

A It is appropriate to include sickness records and time-keeping among the criteria. Both of these are valuable performance indicators and will help to weed out those members of staff who may be under-performing or working less efficiently than their colleagues. However, great care must be taken when applying these criteria. For instance, you must discount any sickness absence that may have been caused by a disability claimed by the employee. Similarly, you should also discount late attendance, which may have been caused by childcare commitments. Including absences or late attendance caused by those factors could expose you to a claim of discrimination and unfair selection for redundancy.

Q How should weighting be applied?

A Some criteria may be more important in the selection process than others. For instance, if greater emphasis needs to be put on technical expertise, then you can give greater weight to that criterion in the selection process. You could also weight criteria such as disciplinary records or productivity to ensure that weaker candidates are selected. Performance-related criteria can also be weighted by a percentage factor to ensure that, in the final score, the defects of under-performers are given extra priority, thereby making their selection more likely over the better-performing employees. This is a quite legitimate approach to weeding out poor performers in a redundancy scenario. But employers should remember that tribunals want to see straightforward and objectively applied methods of selection. The more complicated and weighted a selection matrix is, the more a tribunal is likely to find fault with it.

Q What selection criteria should not be used in the redundancy process?

A There are certain factors which must never be used in a matrix. For instance, if the matrix is based on long-term sick leave or maternity leave, then the redundancy may be automatically unfair. You can include length of service as a factor, but it is now appreciated that it is no longer a conclusive factor in who is to be selected. This factor needs to be re-examined to ensure it does not discriminate against age. It is best used where, all other things being equal, there is a ‘tie break’ between a number of equally matched employees. Other commonly used selection criteria – including so-called soft skills, such as team fit, enthusiasm, motivation and flexibility – should also be used wisely to negate the possibility of facing a discrimination claim.

Q How specific should the competencies be?

A Under the headings of ‘technical expertise’ or ‘knowledge and skills’, you may wish to specify a number of competencies which you regard as being important. Such competencies could include computer literacy and typing skills, for instance. It is best that you make these competencies as specific as possible, or else you will run the risk of the criteria being criticised as being vague and difficult to measure.

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