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Redundancy: 5 Common Mistakes for Employers to Avoid

Making redundancies is often part of the natural cycle of a business and we regularly help organisations with practical support and legal guidance during this difficult time.

However, a difficult time can be made all the more tricky by a few common pitfalls that can catch out even the most diligent employer.

So, here are the 5 most common redundancy pitfalls to be aware of:

  1. Redundancy Selection Pools
  2. Redundancy Selection Criteria
  3. Making Employees Aware of Open Vacancies
  4. ‘Alternative Employment’ vs. ‘Suitable Alternative Employment’
  5. Being Thrown ‘Curve Balls’
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1. Redundancy Selection Pools – Are They Wide Enough?

The selection ‘pool’ for redundancy may not always be as clear as it first looks.

You might clearly see a team of administrators who support an area of the business as redundant, but should the redundancy selection pool also include administrators from across the business who do the same kind of work? If you don’t consider this, then you may find yourself with unexpected requests for transferred redundancy or claims of unfair selection.

We help employers consider their whole business when they are thinking about redundancies, to make sure the pools are as wide as they should be.

2. Redundancy Selection Criteria – Is It Really Objective?

Once you have a pool, the redundancy selection criteria applied to that pool is key.

We recommend you consider the following selection criteria for redundancy

  • Is it fair and objective?
  • Is it putting anyone with a protected characteristic at a disadvantage?
  • Is LIFO (last in, first out) still appropriate as a selection criteria?
  • How can I avoid inadvertent discrimination?

3. Making Employees Aware of Open Vacancies – Don’t Assume They Know…

Many employers don’t realise that they should make employees at risk of redundancy aware of ALL vacancies that are available in the organisation regardless of whether they seem likely to apply.

It is not for the employer to decide whether an accountant may want to avoid redundancy by applying for a junior marketing vacancy, so give everyone the opportunity to apply for everything – just to be on the safe side…

This also goes for slotting ‘at risk’ employees into a role that others could potentially fill without a proper selection process.

4. Difference between ‘Alternative Employment’ and ‘Suitable Alternative Employment’

If you are considering redeploying someone whose role is redundant, you need to decide whether the new role is ‘Suitable Alternative Employment’ or ‘Alternative Employment’ as this can affect the process.

  • If the proposed role is Suitable Alternative Employment, then the employee is obliged to fill that role and is no longer redundant.
  • If the proposed role is Alternative Employment, then the employee can have a 4-week trial period to see if it’s right for them and choose redundancy if it’s not.

Confusing the two terms may cause an expensive dispute.

5. ‘Curve Balls’

Even after all the detailed prep, an employee can still throw you a curve ball during the consultation period. For example,

  • “Have you considered my previously undisclosed disability/pregnancy/other protected characteristic?” being very common;
  • “I would like to resign now and still claim my redundancy payment” being another.

These kinds of disclosures don’t need to derail your entire process, but will need careful handling as a rash response could have uncomfortable consequences.

If you are thinking about restructuring, downsizing and making redundancies, then do take some time out to plan carefully and consider the above.

If you’d like help with managing redundancy or any other HR matter, contact us on 0203 319 1649 or fill in the form below.

Contact Us

If you’d like help with managing redundancy or any other HR matter, contact us on 0203 319 1649 or fill in the form below.

Contact Us

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