Redundancy is the dismissal of an employee because the employer needs to reduce the workforce.
The law regards it as different from a typical dismissal because it is not focused on the employee and his or her capability or conduct. It is the job that is deleted rather than the employee who is sacked.
Business reasons for redundancies could include new technology or a system that makes a job unnecessary, the need to cut costs, or that a business is moving location.
An employer must ensure that a redundancy fits its statutory definition under Section 139 of the Employment Rights Act 1996.
This redundancy process requires that employers follow a fair and objective procedure. One important factor is to ensure that the selection of employees is based on evidence and not just on the employer’s feelings.
Redundancy could be unfair if employees are not properly consulted and explanations given.
‘Collective redundancy’ is where more than 20 employees are made redundant within a 90-day period and in one establishment. Again, if consultation is not done properly, the employer could face a legal claim and an award of up to 90-days’ pay under Section 189 Trade Union and Labour Relations (Consolidation) Act 1992.
If there is another, vacant job similar to the one being deleted, the potentially redundant employee has the right to be offered that job first.
Employees facing redundancy have a number of other rights. These include rights concerning time off and pay.
The redundancy dismissal process is devilishly difficult and legal advice should be sought.