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Collective redundancies

With the new financial year having started earlier this year some important new changes to employment law have also come into effect.

Reduction in consultation period to 45 days when 100 or more redundancies

One change relates to the consultation time for collective redundancies and from April 6 a new ruling comes into effect which applies to those employers wanting to make redundancies numbering over 100.

The consultation period, which had been 90 days, has been cut in half to at least 45 days before the first dismissal.

However, employers should note that 45 days is the absolute minimum so they should take longer of that is required. They should also note that if it can be shown that an employer has deliberately waited for this change to be introduced, before starting the redundancy process, they could face future dispute over when the need to consult actually began.

Other points to note:

  1. The protective award for failure to consult stays at the present 90 days maximum.
  2. The minimum consultation period stays at 30 days for those employers wanting to dismiss between 20 and 99 employees.
  3. Those on fixed term contracts which have reached their agreed termination point will be excluded from the requirement to consult, although the fixed term contract must have a clear termination date.

The consultation which takes place should be between the employer and a representative who should either be a trade union rep or an elected employee rep. The dialogue between the two should cover:

  • Ways to avoid redundancies
  • The reasons for redundancies
  • Ways to best keep the number of redundancies to the minimum
  • Limiting the effects on the workers concerned, for instance by offering retraining or advice on securing alternative employment.

Employees who believe that their employer has not followed the redundancy procedure as outlined may well be entitled to take the case to an employment tribunal.

Notice of redundancy

The periods of notice that employees are entitled to are as follows:

  • Employees who have been with the firm for at least a month but less than two years – one week’s notice
  • Those who have been with the firm for at least two years – a week for each complete year of employment up to a maximum of 12 weeks

These are the minimum amounts of notice given. An employee may find that their contract of employment gives them more notice than this and should therefore check.

Employees who are under a specific notice of redundancy but have, in the meantime, found another job, have the right to leave to take the new job during that notice period. However, they may lose the right to redundancy pay if they do not follow a specific legal procedure.