Getting Redundancy Right - Amy Webster
Updated: Jun 11
By Amy Webster
The first wave of redundancies is well and truly here and it’s not pretty. We’ve been conducting free consultations in these last few weeks, some of which have been with employees who have been made redundant with little or no process. This is not lawful and puts the employer business at high risk of a successful personal grievance for unjustified dismissal.
The risk For employers considering redundancies, it is in your long term best interests to get some help and take a week or so to go through a proper process to protect your business from the risk of having to pay out lost wages, compensation for hurt and humiliation and a contribution to the employee’s legal costs, which all adds up – and we’re talking upwards of $10K (per employee), not including your own legal fees.
Getting it right Before making any employees redundant, employers must (1) have a genuine business reason for disestablishing the role(s) and (2) the employer must follow a fair and reasonable process.
In the current climate, it’s likely that many employers have a “genuine business reason” to reorganise their workforce and make some roles redundant due to facing financial difficulties bought on by COVID-19.
It is the second element where we are seeing employers fail. Some are following no process at all; simply telling people there’s no work and giving notice, while others are following some form of process, which is either not robust enough or has clear elements of predetermination (i.e. the decision has already been made and they’re just going through the motions).
The government has some useful (and free!) information and templates for going through a change process. Overview of workplace change Workplace change process outline Assessing the impact of structure change on jobs Selection Process Restructuring when a business is sold or transferred
How we can help The Employment Team at Wakefields Lawyers can add value to these resources by:
Talking through your particular situation, what steps you’re thinking about taking, the process you’re thinking of following and the timing of the process to make sure it’s robust enough to meet the requirements of employment law, including the obligations you signed up to when applying for the COVID-19 Wage Subsidy (you can use a free consult to do this!);
Drafting the change proposal for you or giving the proposal you have drafted a quick once-over to make sure you’re safe to proceed with giving it to staff;
Assisting you with considering any feedback you receive from staff on the proposal and how it may/may not change your decision;
Drafting a communication to staff (or reviewing one you have drafted) with your decision;
Helping you through a fair selection process, if one is required; and
Answering any questions that come up along the way.
We can also help you deal with any employee concerns or personal grievances that are raised as a result of any redundancies you have already made or redundancies you make in the future. If you are an employer considering redundancies or an employee who has been made redundant, contact our Employment Law Service Coordinator today for a free consultation to understand your rights and responsibilities: Employment Law – Amy Webster Phone: 021 751 263 Email: email@example.com