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Restructures and Redundancy
A business may need to change its structure for a variety of reasons such as financial pressure, changes in the market, or the introduction of new technology. These changes can result in restructuring or redundancies. A restructure can occur without redundancies if no jobs are lost. However, if the restructuring involves job losses, a formal redundancy procedure must be followed.
Understanding Redundancies
Redundancy can be a fair reason to dismiss an employee, provided that a genuine redundancy situation exists. Employees dismissed by reason of redundancy may be entitled to a statutory redundancy payment and may be able to challenge the termination of their employment as an unfair dismissal. Employees with two years’ service or more have the right not to be unfairly dismissed. Failure to follow a fair redundancy procedure is likely to result in the dismissal being deemed unfair.
A Fair Procedure
A fair procedure comprises three main stages:
- Following a fair selection process
- Following a fair consultation process
- Considering alternative employment options
Who We Can Help
We are here to support businesses of all sizes, supporting
- Business Owners: Make informed decisions about restructuring and navigate potential redundancies with confidence.
- Managers: Ensure a smooth transition for your team and minimise disruption to productivity.
- HR Professionals: Benefit from our legal expertise to implement a compliant and fair redundancy process.
Regardless of your specific role, we offer tailored guidance and support to mitigate risks, protect your business, and achieve a successful outcome.
Key Considerations for Employers
When planning redundancies, employers should know:
- What “Redundancy” Means: The employer must consider the reason for the redundancies and ensure that it is a genuine redundancy situation to minimise the risk of claims for unfair dismissal. The selection of employees for redundancy must be conducted fairly.
- Collective Consultation Requirements: Employers must inform and consult collectively (with trade unions or employee representatives) about redundancy to ensure fairness and legal compliance.
- Fair Treatment of Individuals: Employers must handle individuals being considered for redundancy fairly to minimise claims of unfair dismissal and discrimination.
- Alternatives to Redundancy: Employers should consider alternatives to redundancy, including lay-offs, short-time working, not renewing contractor contracts, voluntary redundancies, and restricting recruitment. There is a legal requirement to consider suitable alternative employment to avoid redundancies.
- Determining Redundancy Payments: Employers must determine an employee’s entitlement to a statutory or contractual redundancy payment.
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Our Recent Cases
- Advised on the redundancy process for a major retail company.
- Assisted a technology firm with restructuring and managing redundancies.
- Provided guidance on compliance with redundancy procedures for a multinational corporation.
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Associate Solicitor, Employment
Associate Solicitor, Employment
Partner, Employment
Partner, Business Immigration
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