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In carrying out a redundancy, every employer will be keen to act as sensitively as possible, and, above all, to avoid an unfair dismissal. With a reduction of the qualifying period for unfair dismissal to one year and the recent increase to £50,000 for the limit on the compensatory award, this has become a key strategic issue.
Although the legal position is relatively complex, there are four steps employers can take towards ensuring the dismissal is fair.
1. Genuine redundancy
The position here has been simplified by the recent House of Lords' decision in the Murray case. For a genuine redundancy to take place, tribunals need ascertain two facts. First, whether a particular state of economic affairs exists - for example, whether the employer's requirement for employees to carry out work of a particular kind has diminished - and, if so, whether the dismissal is attributable to that state. And, second, whether there has been fair selection.
2. Fair selection
The employer will need to show that the individual chosen for redundancy has been fairly selected by objective criteria. The most popular selection process is a points system, taking into account a number of objective issues. Employees should be aware, though, that employees may ask the tribunal for disclosure of the point scores. Before starting on selection, employers should also be careful to identify the "pool" of staff from which to select.
3. Alternative employment
Evidence is required of the employer having considered alternative vacancies within the organisation for those selected. This may mean canvassing associated companies. If in doubt, always put lower status and lower paid jobs to the individual, as it is otherwise open to the employee to state that they would have considered a lower status job had it been offered.
4. Consultation
The employer should be careful to consult with the selected candidate before the decision to implement redundancy is made. It is highly recommended that a minimum of two meetings are scheduled with each employee, at least a week apart, so that an explanation of the situation and outline of the terms can be given, with a subsequent opportunity for the employee to give their views. The employee should also be encouraged to debate the matter with the employer in the interim. It is wise not to make a formal decision to implement
