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Alternatives to Redundancy

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  1. Alternatives to Redundancy By Andrew Monroe Employment Service Manager ca Plus

  2. Today: • Funding Cuts • Alternatives to redundancy • Salary cuts? • Reduction in Hours? • Changes to T & C’s? • Suitable alternative work? • Identifying and planning future needs • Reorganisation • Consultation • Handling job losses - redundancy

  3. Funding Cuts: • Cup half full, or half empty? • Opportunity or Threat? • SWOT analysis: • Funding cuts rarely get reinstated!!! • What's gone today, stays for tomorrow

  4. Alternatives: • Dismiss staff < 12 months service, retirement (limited?) • Salary cuts / reduced hours / changes to T & C’s • Any contractual clause, policy, provision, entitlement can be changed if there is the mutual consent of both parties • Salary/hours/T & C’s can all be varied with mutual consent either permanently or temporary • If this is not sufficient, maybe no other choice but to cut number of posts • E.g. existing full time post is redundant, an alternative part time post is however available • Invite applications for voluntary redundancy?

  5. Planning • Confirmed funding only until 31st March? • Timelines: i) 30 days consultation period? ii) 12 weeks notice period? • = 16 weeks, from today runs till 25th May !!! • Use reserves? Do you have sufficient? • Look at your future needs, not those of the past • Trustees/Committee need to be involved • Recently joined staff may have more relevant skills experiences, than staff who have been with you the longest • Needs of the Business. Not Needs of the Staff!


  6. Reorganisation • CONSULTATION • Partial or project related • Complete / top down restructure • Define restructured posts? • Job descriptions and person specifications • Invite applications • Select fairly / interviews / skills & experience matrix • No posts left, most likely no alternative but redundancy

  7. What is Redundancy? Redundancy can only be a fair reason for a dismissal if it meets one of the main definitions of redundancy: • The Employer has ceased, or intends to cease, to carry on the business for which the employee was employed • The Employer has ceased, or intends to cease, doing business in the place where the employee was employed • Reduction in the employer’s need for employees has ceased or diminished (or is expected to cease or diminish) “DO NOT USE REDUNDANCY AS AN EASY ALTERNATIVE TO DISCIPLINE SOMEONE”

  8. Dismissal • Redundancy a dismissal, BUT it is now excluded from the new ACAS Code on Handling Discipline & Grievance • NEW ACAS Guide to Handling Redundancy (4/2009) • Establish any redundancy procedures (not essential but strongly recommended) in partnership with employees • Need to consult (collectively or individually) • Need to select fairly (method/process) • Right of appeal if employee thinks it’s wrong • Help to find other work (redeployment – suitable alternative work)

  9. Consultation / Notification • Aim is to investigate “any alternatives” to redundancy at an early stage • If > 20 (and/or >90) persons MUST notify Dept. BIS • If > 20 persons being made redundant MUST carry out collective consultation with unions, or elected staff representatives (or facilitate elections) • MUST have consultation with all staff affected, not just the potential redundant staff • If < 20 persons, consultation is still essential, individually or collectively, or it’s unfair

  10. Redundancy Selection Right not to be unfairly selected: • Hence must be a fair selection procedure • Valid selection pool • Redundancy policy; detail how selections will be made • Voluntary; retirement, or what/how? • Compulsory; objective and consistent • Transparent process with consultation and appeal • No “Less Favourable Treatment” • Fair and reasonable treatment

  11. Alternative Work Offers • Statutory duty to offer any other suitable work, if available • Suitable? pay, terms, hours, location • If so, employees can go on a trial, at least 4 weeks (can be extended) • If unsuitable (either party), can still take redundancy • Working beyond trial period (redundancy offer is then lost) • Refusal to accept alternative work, excludes employee from redundancy pay and rights • Who decides?

  12. Assess Redundancy Liability • Redundancy liability, risk assessment • Need to build up contingency fund / restricted fund • Set out reasons for restricted fund in accounts • Do Funder’s guidelines permit redundancy payments? • Most do if set out in initial application • If unused may have to give back (unlikely) • Possible backdated liability if a fixed contract with “waiver clause” post Oct. 2002

  13. End