I work for a company with 40 employees. Unfortunately, we have recently entered into a period of consultation before possible redundancies, which is to last for 30 days. Can periods of notice run concurrently with the 30-day consultation period, or must we wait until the consultation period is over before serving notices?
Michael Sissons, solicitor, Magrath & Co, replies:
You must begin consultation in good time to allow consultation to take place and, assuming you are proposing to dismiss at least 20 staff within a period of 90 days or less, you must begin consultation with employee representatives at least 30 days before the first of those redundancy dismissals takes effect.
UK legislation does not specify when notice of termination can be given. Because of this, employers have, historically, given notice of termination so that some, or even all, of the notice period runs concurrently with any consultation period.
However, in Junk v Kuhnel, the European Court of Justice recently ruled that ‘redundancy’ means the act of giving notice to terminate a contract of employment, and not the date on which the employment actually ends. Applying this definition to UK law means that an employer may not issue a notice of redundancy until it has first completed the requisite process of consultation. Many commentators have taken this to mean that the full 30-day consultation period must be observed before an employer can give notice to terminate (the full 90 days if it proposes to dismiss 100 or more staff within 90 days). While this is clearly the safest option in your case, it is more expensive than running the periods concurrently.
An alternative interpretation is that an employer may give notice to terminate once the actual consultation process is complete. This means that, once you have completed a full process of genuine consultation with your employee representatives, you can give notice to the individuals selected before the 30 days is up. Therefore, so long as it does not expire before the end of the 30-day protected period, notice can run concurrently.
It is important for employers to comply with their obligations to consult, as failure to do so can result in a tribunal making a protective award of up to 90 days’ pay to each affected employee.