Redundancy & Restructure
Many businesses are looking to restructure their workforce following the Covid pandemic. Engaging an expert employment solicitor early in the process can help reduce costs and limits the legal risk.
How can we help?
Redundancy and Restructure Legal Advice for Employers
Our team offers clear and pragmatic advice on handling redundancy and restructure situations to ensure legal compliance and effective workforce management. We provide legal advice and support in a sensitive manner in these difficult situations allowing you to concentrate on running the business.
The redundancy process
If you do not have enough work for your staff or cannot afford to pay them, you may need to consider making redundancies.
When making redundancies, you must follow the correct legal procedures and conduct a fair consultation process. The exact process depends on the number of staff affected.
Collective consultation can easily take several months to undertake and even a more straight forward individual redundancy consultation can take several weeks to complete. Timing is therefore critical – don’t start too soon as there is affine line between considering such cost saving measures and the trigger for consultation to start. Conversely, if an employer waits then it may be delaying the inevitable and increasing costs.
The exact process depends on the number of staff affected:
- Less than 20 redundancies proposed – individual consultation with affected staff directly
- 20-99 redundancies proposed at one establishment within 90 days – collective consultation for at least 30 days before giving notice.
- 99+ redundancies proposed at one establishment within 90 days – collective consultation for at least 45 days before giving notice.
Employee’s with over two years’ service will be entitled to a statutory redundancy payment. It’s important to calculate the costs of potential redundancies in advance.
At the outset of the redundancy procedure, and throughout the consultation process, you must consider whether you can avoid or reduce compulsory redundancies by taking alternative measures.
These are worth considering at an early stage so that, if necessary, you can start the formal redundancy process without delay. Alternatives may also be more cost effective than redundancies.
Subject to the terms of your employment contracts, these may include:
- Suspending or reducing recruitment, withdrawing new job offers, deferring new joiners.
- Reducing or stopping using agency staff.
- Redeploying existing staff.
- Offering voluntary redundancy or early retirement.
- Terminating or reducing contracts with self-employed contractors.
- Seeking applicants for sabbaticals or unpaid leave.
- Asking staff whether they wish to take holiday – this will be paid but will mean that staff do not take it later in the year when normal work levels resume and saves a business from having to pay for any accrued but untaken leave on termination.
- Reducing or suspending overtime or bonus arrangements in accordance with the terms of the scheme.
- Seeking applicants for part-time or flexible working.
- Implementing pay freezes, pay cuts or bonus withdrawal.
- Checking contracts of employment to see if they provide for lay-offs or short-time working.
- Job retention scheme / furlough (only for eligible staff and the scheme is due to end on 30th April 2021).
Before planning any redundancies which could prematurely trigger consultation, properly take the time to consider the basis of the redundancy:
- Less need for work of a particular kind;
- Business closure; or
- Workplace closure.
This will dictate the consultation process so do not be drawn into starting the review by simply deleting roles from a structure chart as this is the wrong approach and could delay or impact a fair consultation process.
Redundancy & restructure legal advice
In addition to advising and supporting you through the redundancy process, we are able to provide a pragmatic and creative approach to enable business reorganisation in different ways. We offer advice on a range of practical and legal options, from varying contractual terms, reducing pay and benefits, temporary measures such as short-time working and lay-offs, through to using zero-hour contracts, agency workers, and self-employed contractors.
The practical advice and support we provide includes assistance with communication and message delivery to staff as well the preparation of selection criteria, consultation letters an assistance with calculating redundancy costs.
Read our Guide to Restructuring & Redundancy
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