Redundancy: Managing Collective Redundancies

2. Collective Consultations

2a. When should collective consultation begin?

Whilst we’ve explained how long collective consultation needs to last, you also need to think about when it’s appropriate to begin the process.

You must start consultation when there is a business proposal on which to consult and before that business proposal has become set in stone and is a decision.  This can be a difficult balance. You will want to get your thinking to a fairly advanced stage before you cause upset to your employees by starting to talk about potential redundancies. Equally, it is very important that the employee representatives have a real opportunity to influence the final decision. This means you can’t leave it too late. 

There’s no fixed answer to when the collective consultation should begin. Our guidance is that when you’re comfortable that you can explain what you are proposing and why, that is likely to be a good sign that it’s time to start collective consultation.

2b. What is collective consultation?

Collective consultation is a process whereby you consult with elected employee representatives or a trade union. For most of our clients there is no union recognised so consultation will be with employee representatives.  It could be that you already have employee representatives in place for other reasons (staff council, employee engagement etc.). You can engage with these individuals for redundancy consultation.

If you don’t have reps already in place, then you need to undertake an election process.

2c. How are employee representatives for collective consultation elected?

If you need to elect reps then you need to ensure that the election process is fair.

There are some clear rules on this area:

• You need to ensure that there are an enough representatives to speak for the interests of all affected employees. Ensure that all potentially impacted departments have representation.  As a rough guide, you will typically look at a ratio of 1 representative to 20 impacted employees.
• You need to decide the duration for which the employee representatives will hold office. Clearly, the minimum will be for the length of the consultation process. However, you may want to keep any representatives who remain employed at the end of the process in post for longer to support ongoing communication.
• Only affected employees can be employee representatives. So, if your business has 4 departments and your proposal only impacts 2 of those departments, then the representatives must be working in one of those 2 affected departments.
• Employees can vote for as many people as there are representatives to be elected – if you need 5 reps for a department, then each employee in that department has 5 votes.
• The voting should be done in secret. You must take all reasonable steps to ensure that everyone has the opportunity to vote.

2d. What happens once the employee representatives for collective consultation have been identified?

Once you’ve identified your employee representatives, you need to ensure that they are fully aware of their responsibilities. You also need to ensure they have the skills that needed in order to fulfil the role.  Typically, the way that you will discharge this responsibility is to have an initial workshop session with the representatives. We have created materials that can be used in this session. The materials explain the responsibilities and also have a couple of practical activities to support the individuals in developing the skills that they need.

2e. What needs to be covered at the first collective consultation meeting?

Once you the representatives are trained and ready to go, you have the first consultation meeting with them.

There are some key things that you need cover in the first meeting.

The Business Proposal

You need to provide the business proposal, in writing, to the representatives. You also need to provide them with as much additional information as possible to allow them to understand and feedback on the business proposal.  As an example, if you are proposing a headcount reduction due to a need to reduce costs, you will need to provide the representatives with details of the cost saving that’s required, and potentially information into other costs within the business, to allow the representatives to identify other ways that savings could be made.  The more information you can provide and the more collaborative you are during this process, the better.  You do, of course, retain discretion regarding how much information you want to share. You don’t have to share commercially sensitive information.

Number and types of employees who are potentially at risk of redundancy

Confirm in writing the scale of the proposed redundancy and the roles that are potentially affected. You also need to provide confirmation of the number of employees who are currently performing those roles. Note: It is likely that this information will be included in your business proposal.

Ways to avoid redundancy

This is a key element of consultation. The representatives should be encouraged to bring forward ideas and suggestions as to how the redundancies could be minimised or avoided altogether.

The redundancy terms

Share the financial terms you’ll offer to individuals if you decide to proceed with the redundancies. It is essential that you get these correct to ensure you manage expectations.

The selection process

Share how you propose to select people to be made redundant.

Remember, you haven’t made any decisions yet.  You are consulting with the representatives on what the business is proposing to do, why it’s proposing to do it and how it’s planning to do it.  To ensure a meaningful consultation, start the process before finalizing plans and be open to modifying any proposed element based on group feedback. 

After this first meeting, it is the responsibility of the employee representatives to share the information with the rest of your employees. They need to gather feedback from the employees and ideas and questions they have about what is being proposed.  The employee representatives are the conduit between the business and employees and keeping that two-way communication going is vital.

2f. How often are meetings with the employee representatives during collective consultation?

There are no fixed rules on this. Remember consultation must be meaningful, so you do need to ensure that there are sufficient meetings to allow the representatives to put forward their suggestions and questions and to have those suggestions and questions answered. 

We would suggest that a minimum of weekly meetings would be appropriate. However, you may need more frequent meetings than this.

2g. How long does collective consultation have to last?

While the law clearly states that collective consultation must begin a fixed number of days before issuing the first redundancy notice, it doesn’t specify the duration of the consultation. 

Let’s take an example:

• You are considering making 25 people redundant and you’re ready to begin talking to your employees about the proposal.
• You elect your employee representatives and you complete their initial briefing session.
• Day 1 – you open collective consultation
• Day 7 – you have the second collective consultation meeting
• Day 14 – you have the third collective consultation meeting and the employee representatives agree that there’s nothing more to consult on: they’ve agreed the business proposal, the selection process and the terms. You can, therefore, close collective consultation. Important note: you cannot issue any redundancy notices at this time as 30 days have yet to elapse since you started collective consultation. 
• Day 30 – this is the earliest date on which you can issue your first redundancy notice.

2h. What happens if agreement is not reached with the employee representatives during collective consultation?

You must initiate consultation aiming to reach an agreement with appropriate representatives. Clearly situations can arise where this simply isn’t achievable and you find yourself in deadlock.

In this scenario, you will need to make a decision and move ahead with the proposals. However, you must be able to demonstrate that you have considered the ideas and suggestions of the employee representatives and have solid business reasons as to why they are not feasible.  Documentation will be everything here so be thorough in capturing information that supports your decisions.

Manager’s Guide to Redundancies

Read our comprehensive guide to redundancies providing overview of redundancy requirements for UK employers and detailed insights into key activities and decisions.