The right path for redundancy and restructuring

Company restructuring and reorganisation is an essential part of business planning, in good times and bad. 

The gradual winding down of the government’s Coronavirus Job Retention Scheme (CJRS) is likely to be a catalyst for many businesses to review their team structures and staffing needs, ensuring business continuity and retention of key employees. 

However, businesses need to minimise the risk of potential employment claims. Firstly, the definition of redundancy must be met and it’s important to show that the business has explored other options to avoid redundancies. 

These may include reduced working hours over the full working week or asking employees to agree to working fewer days per week. Business should also consider whether there are any alternative vacancies within the business, or across a group.

If redundancies are still required it may be necessary, depending on numbers, to undertake a consultation process. Consultation involves meeting with employees that are at risk of redundancy as a group, to explain the reasons behind the redundancy process and to inform of how many jobs are at risk. 

Businesses need to minimise the risk of potential employment claims

At the initial meeting, you may wish to ask for volunteers for redundancy to reduce the number of compulsory redundancies that will be made. If collective consultation is required, employee representatives should be elected and consulted, or consultation with trade union representatives should take place.

The redundancy process requires careful planning and if you are considering making redundancies, we always advise businesses to seek legal advice at an early stage to ensure that all legal requirements are met and to avoid common mistakes.

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