Alternatives to Redundancy By Andrew Monroe Employment Service Manager ca Plus
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
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
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?
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!
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
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”
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)
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
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
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?
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