Redundancy
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Practical and ethical guidance for employers
Redundancy processes are challenging for most organisations. Alongside financial and often-complex legal considerations, redundancies can affect morale, operations and the reputation of the business.
The Bellevue Law team has decades of experience in supporting clients to handle redundancy processes effectively, sensitively and ethically. We offer tailored, expert advice on your legal obligations and practical options, with pragmatic support to ensure the process is compliant and feels as fair as possible for everyone involved.
Understanding your legal obligations
Redundancy is a legal process. Technically, it arises when a business or workplace closes, or when employers have a reduced need for employees to perform a particular type of work; for example, due to financial pressures, merging with another business or a change in strategy or operations. It does not apply to termination of employment for other reasons, such as performance or misconduct.
Additionally, employers must carry out a fair process before making employees redundant, including warning and consulting potentially impacted employees, adopting fair selection criteria and considering any suitable alternative employment.
Whether directly or indirectly, selection decisions should never be influenced by protected characteristics such as age, sex, race, disability or pregnancy. Failing to follow these steps can expose your organisation to claims of unfair dismissal or discrimination.
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Considering negotiated exits
As redundancy processes can be time-consuming, distracting and difficult for all concerned, many employers choose to offer at-risk employees enhanced terms in exchange for their agreement to accept the redundancy.
A key element is often a financial package in excess of statutory redundancy pay. Employees who accept the offer enter into a settlement agreement containing details including their exit date, financial package, and confidentiality and non-disparagement provisions. Settlement agreements also include waivers of potential claims against the employer, providing legal certainty.
While voluntary, enhanced packages are often welcomed by employees, as they provide an improved financial cushion and avoid the prolonged stress and uncertainty of a formal consultation process. Handled well, they can help employees feel respected despite the challenging circumstances.
If this may be an option, we can support you to create appropriate packages and prepare settlement agreements and communications with employees, as well as during any discussions which may follow. We have extensive experience in helping clients to negotiate redundancy terms and exit packages, managing legal risk and safeguarding the interests and reputation of your business while also protecting relationships.
In many cases, we can provide a package of support on a fixed-fee basis, providing a degree of welcome financial certainty.
Support for fair and effective outcomes
At Bellevue Law, our approach to supporting employers through redundancy processes combines clear advice on legal obligations with a sensitive, respectful and ethical approach to potentially impacted employees.
If redundancies may be in prospect, we recommend seeking advice at an early stage. This allows time to plan carefully, address legal and commercial risks, and ensure the process is tailored to the unique circumstances of your organisation and its people.
We find that this often results in a process which feels fairer to employees, runs more smoothly and swiftly, and protects the company’s reputation and relationships.
Please get in touch if you would like our support with a redundancy process.
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