Redundancy – getting it right | Employment Law

January is prime time to set goals and look forward to the year ahead. Unfortunately in the world of business, this may mean reviewing finances and making redundancies.

The key question is, how do employers keep the stress of this process to a minimum whilst ensuring they follow the correct procedure?

Making the decision

The first factor to consider is whether there is a “genuine redundancy situation” in other words is the employer reducing its workforce, closing the business or closing a department within the business.

Dismissing an employee on the grounds of redundancy where there is no “genuine redundancy situation” is grounds for unfair dismissal and puts employers at risk of an employment tribunal claim.  It is therefore crucial for employers to ensure they do have a genuine reason to make redundancies and they are not using it as a smokescreen.

If in doubt, employers should always seek legal advice at this point and in any event before meeting with its employees.

Starting the process

If there is a genuine redundancy situation, the next step is deciding who is at risk. Where, for example, the employer is closing a department in the business, they would choose all the employees in that department. Where they need to make several redundancies, it is crucial they identify a pool of employees and show why they have chosen them in particular via selection criteria which looks at factors such as (i) length of service (ii) performance (iii) disciplinary record and (iiii) skills.

Is this the only option?

Employers should consider at the outset (and throughout the process) whether there is an alternative to making redundancies e.g. removing overtime opportunities, reducing employee hours.  They should also search for any suitable alternative roles within the business, suitable being where the employee is capable of carrying out the alternative role and, for example, has the relevant skills for the alternative role.


This is the key stage of the process. How long it lasts will depend on the number of employees being made redundant. If less than 20, there is no minimum consultation period so it could take as little as a few days.

During this process, the employer should meet with the employees in order to notify them of a potential redundancy situation, discuss alternatives and confirm redundancy once the decision is made.

Reducing the stress

Redundancies can be a stressful time for the employer and the employee. It inevitably involves difficult conversations and emotions will run high.

As an employer, following the steps above will not only ensure the legal process is complied with thus reducing risk of a tribunal claim, it will give the employee advance warning and the opportunity to ask questions. It may be that the employer offers counselling services and outplacement support during the process as well.

Employers should always seek legal advice when considering making redundancies.

Lauren Cope is a Solicitor in our Employment team and is able to assist employers and employees in this area of law, from identifying a redundancy situation through to the end of the process.

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