The Coronavirus Job Retention Scheme will begin to wind down from August 2020, with the scheme eventually being withdrawn by the end of October.
For many this will involve a welcome return to work, whether to normal hours or under short term flexible furlough arrangements. However, there will also be difficult decisions and inevitably some redundancies. How do you deal with redundancy without ending up in the employment tribunal?
A redundancy is a dismissal and, if not handled correctly, can result in an employment tribunal claim, even if the financial circumstances and business levels justify the need to reduce staff. The most likely claim would be for unfair dismissal, usually requiring 2 years’ service, but claims may also be possible with less service if the dismissal is really for another reason, such as pregnancy, or asserting certain rights. Claims that an employee’s dismissal and/or the redundancy process is discriminatory are also possible regardless of the employee’s length of service. It is therefore advisable that employers conduct a fair redundancy process even where the affected employees have less than 2 years’ service.
For a redundancy to be fair, it must be based upon a decision that less staff are required, either to perform particular tasks or at particular locations, there must be proper communication and consultation with affected employees, and fair and objective selection criteria are essential. Note that it is crucial to ensure that the process is not discriminatory.
Following a fair and robust process, as well as ensuring that the employee receives their entitlements, whether contractual or statutory will reduce the possibility of having to deal with a tribunal claim, help avoid inadvertent discrimination and can ensure that damage to the business and morale is minimised.
It is also open to an employer and employee to reach a commercial agreement regarding the termination of employment, referred to as a settlement agreement, whereby the employee agrees that they will not pursue any claims. This is something usually deployed where a redundancy involves an enhanced payment and/or there is risk of a claim. However, this requires a specific agreement and the employee must receive independent legal advice for it to be binding.
The Lawspeed Employment Team can assist with redundancy decisions, in terms of process, advice, communication and dispute and where required can provide and assist with settlement agreements. For assistance with these matters and any other employment issues or documentation, contact the Lawspeed Employment Team on 01273 236 236 or firstname.lastname@example.org