Redundancy

Before proceeding with Compulsory Redundancy Luke Curran & Co. recommend that you consider all alternative options. The measures for reducing or avoiding compulsory redundancies may include:

• achieving a reduction in the number of employees by not replacing those who leave;
• restrictions on recruitment;
• the possibility of job share;
• retraining and moving staff to other parts of the organisation;
• reducing or removing the need for overtime;
• introducing short-time working or temporary lay, where this is provided for in the contract of employment or by an agreed change to its terms; and
• looking for people to take early retirement or voluntary redundancy.

For entitlement to redundancy payments, under the Employment Rights (Northern Ireland) Order 1996, redundancy arises when employees are dismissed because:

a) the employer has stopped, or plans to stop, carrying on the business for the purpose which the employee was employed for;

b) the employer has stopped, or plans to stop, carrying on the business in the place where the employee was employed;

c) the business no longer needs as many employees to carry out particular kinds of work, or this is likely to be the case in the future;

d) the business no longer needs as many employees to carry out particular kinds of work in the place where the employees were employed, or this is likely to be the case in the future.

If an employer is considering making an employee redundant, they must follow a standard dismissal procedure as set out in the Employment (Northern Ireland) Order 2003 (Dispute Resolution) Regulations (Northern Ireland) 2004. This involves:

• writing to the employee;
• setting out the reasons for the redundancy;
• meeting the employee to discuss the redundancy; and
• holding an appeal if the employee asks for one.

As far as possible, unbiased criteria, precisely defined and capable of being applied in an independent way, should be used when deciding which employees should be made redundant. The purpose of having unbiased criteria is to make sure that employees are not unfairly selected for redundancy. Examples of such criteria include attendance record, disciplinary record, experience and capability. Employers must apply the chosen criteria to all employees consistently, no matter how big the business or organisation.

An employee who has been made redundant will be found to have been unfairly dismissed if he or she was unfairly selected for redundancy or discriminated against.

A redundancy may also be considered automatically unfair if the reason or main reason is redundancy but the circumstances apply equally to other employees who have not been chosen. Employers need to show that in choosing a particular employee, they had compared him or her in relation to the agreed selection criteria with those others who might have been made redundant and that, as a result, the employee was fairly selected. A claim for unfair selection may also arise where the employer has failed to undertake a reasonable search for alternative work throughout the organisation.

Employers should take particular care to make sure that selection criteria do not discriminate against anyone because of their age, sex, race, disability, sexuality, religion or political opinion. For example, choosing part-timers for redundancy may be considered to be indirect discrimination against women.

Using criteria is not enough to guarantee fair and reasonable selection. Even though the criteria may be unbiased, the choice will still be unfair if they are carelessly or mistakenly applied. Employers will need to show that they have compared the information relating to all employees in the relevant unit when using the criteria. Selection criteria should be reasonably applied in the light of the circumstances of the individual.

Employees who are under notice of redundancy and have been continuously employed for at least two years qualify for a reasonable amount of time off to look for another job or to arrange training. The employer does not have to pay more than two-fifths of a week’s pay, no matter how much time off they give the employee.

As well as any redundancy payment entitlement, employees who are made redundant should be given the period of notice, or payment instead of notice, they are entitled to by law and in line with their contracts of employment.  Luke Curran & Co. can calculate redundancy payments upon request.

If you have a query in relation to a redundancy situation whether employer or employee please contact us at law@lukecurran.co.uk or 02830267134