Employers who are proposing large scale redundancies have to first go through a process of collective consultation. This is a strict legal requirement; where an employer gets this wrong, employees may bring claims for compensation in the employment tribunal.
If your employer has recently announced proposals to make lots of people redundant then this is what you need to know.
When do employers have to collectively consult?
When an employer is planning on dismissing 20 or more employees in a 90 day (or shorter) period, the requirement to consult collectively is triggered.
The proposed redundancies must all be at the same establishment e.g. at one shop in a chain or one site.
With whom must the employer consult?
The employer must consult with employee representatives, that is:
- trade union representatives (if a trade union is recognised); or
- other existing employee representatives e.g. those on a staff representative body
- employee representatives elected specifically for the consultation process
How long must the consultation process go on for?
Consultation must begin “in good time”. What does that mean?
If between 20 and 99 redundancies are in contemplation, the collective consultation period must start at least 30 days before the first dismissals are made. Where 100 or more staff are at risk of redundancy the consultation period is 45 days.
However, if the employer reaches agreement with the representatives before the end of this period then the consultation can stop earlier.
Failing to begin the consultation in good time is the most common way employers fall foul of the law in this area. Employers should be consulting while there is still time for plans to be amended. They should not start talking to representatives only once the outcome is a foregone conclusion.
What does consultation involve?
Consultation must be meaningful and undertaken by the employer with a view to reaching agreement with the representatives. This does not mean that agreement actually has to be reached but, this must be the aim and the employer must act in good faith throughout.
Consultation must include consultation about ways of:
- avoiding the dismissals
- reducing the number of dismissals to be made
- mitigating the consequences of the dismissals (e.g. by improving the termination packages being offered)
Although the legislation doesn’t specify, this is likely to involve at least three meetings with representatives. This will enable the proposals to be fully explained by the employer, for the representatives to consider these on behalf of the affected employees and for any ideas about avoiding/reducing the number of redundancies to be put forward by the representatives.
What information must the employer disclose as part of the process?
Once employee representatives have been identified then certain prescribed information must be given to them in writing by the employer about the proposed redundancies. This includes information about:
- the reason for the proposed redundancies
- the number and description of employees it is proposed to dismiss
- the proposed method of selecting any employee who may be dismissed
- the proposed method of carrying out the dismissals
- the proposed method of calculating any redundancy payments to be made
- the number of agency workers temporarily working for the employer
Other obligations on the employer
The employer must allow the employee representatives to access the affected employees and must provide appropriate accommodation and facilities to them to enable them to carry out their duties.