Sheffield employment experts warns of difficult times ahead
16 July 2008
With the property market seemingly showing no signs of an imminent recovery it should have come as no surprise last week to hear news that over 2,300 jobs in the construction industry were to be made redundant.
Companies such as Barratt Developments, Taylor Wimpey & Persimmon all had to inform their employees that some of them would be made redundant. It is likely that these will not be the last redundancies as a result of the property slump with estate agents, building companies & other associated businesses likely to suffer as a result. Given that some of the companies providing these supporting services may not have dedicated HR or Personnel departments it is essential that they take advice on how to deal with these redundancy situations so as to avoid claims for unfair dismissal. Liam Kenealy, employment solicitor at Ashton Morton Slack takes us through some of the main considerations when making redundancies:1. Re-deployment
It is essential that the company fully explores the possibility of finding as many employees as possible alternative work within the company. If an employee has skills that can be transferred to another department within the company and there is the work within that department to justify the transfer then this must be considered. A failure to give thought to this could prove costly if the matter goes to the tribunal.
2. Volunteers
Ask the workforce whether any of them are willing to volunteer for redundancy or early retirement. It may be that a financial incentive is offered to encourage people to come forward. This can be less demoralising than compulsory redundancies. If a request for volunteers is made it is always advisable to retain the right to retain an employee's services to prevent too many employees in the same department all leaving at once.
3. Consult
The employees that are facing being made redundant should be consulted with both as a group (union representatives where appropriate) and as individuals. This consultation should be informative setting out reasons for the redundancies, the criteria to be used and how redundancy payments are to be calculated amongst other things. It should also allow the employee the chance to put forward alternatives to redundancy. It may be that they think of something that you have not previously considered such as that they have skills you were unaware of, a desire to work in a different area, re-train at their own expense or be willing to cut the number of hours they work. Any suggestion should be given due consideration.
4. Selection
The most important thing to consider when deciding what criteria to use is to be fair. The criteria to be used should be as objective as possible and ideally be capable of being confirmed by factual information. Criteria such as length of service, skills & knowledge (based on qualifications & CV), attendance & disciplinary record are all good criteria to use. Criteria that are reliant on opinion such as motivation & commitment should be avoided. Once the criterion is established it should then be applied fairly.
Obviously each company is different and as such the factors to consider will vary from company to company but the above should always be key considerations for the people responsible for carrying out the redundancies. Given the problems in not just the property industry but in general due to the ‘credit crunch' there are likely to be more companies having to make redundancies. It is vital that they get this right with claims for unfair dismissal being at a new high and the average payout last year costing employers £7,974. Getting it wrong could lead to small companies being forced to close and so I would always recommend obtaining legal advice rather than taking a risk."
If you are facing the prospect of having to make redundancies then please do not hesitate to contact us on 0114 228 6235 we will be happy to advise you on matters that are important to you.