One of the hardest decisions an employer will ever have to come across is the reasons for making staff redundant. The Company should always seek alternatives to redundancy, but where this is not possible and changes need to be made, it is important to fairly decide who goes and who stays. Remember, it is not the person being made redundant; it’s the role!
Redundancy happens in all industries, and no matter how unpleasant it may be for everyone involved, it is a fair and legal reason for dismissal. But what is crucial is that you comply with all relevant laws and are objective in selecting the correct criteria for redundancy. If for example, an employee suspects you to have dismissed them for personal reasons then you risk potential legal action and damage to reputation.
To ensure your business remains compliant, and to help you decide how to impose redundancy in your workplace, the following article looks at how to identify fair selection criteria for redundancy.
Common reasons for redundancy
Redundancy may be necessary for a variety of different reasons, including:
- New technology has made an employee’s job unnecessary
- A particular job no longer exists due to structural changes
- The employer needs to cut costs by reducing staff
- The business is closing down or has been taken over by another company
How to select your redundancy criteria
Your main task is to decide which employee or employees to make redundant. The following steps will help you to remain objective when making your decision and identify the key considerations to take into account.
- Define your pool for selection
Before you make a clear cut decision about who to let go, it can be useful to define the pool of employees who could be at risk for redundancy. This will help to narrow down your options and make it easier to impose your selection criteria. The pool will depend on the reasons for redundancy being necessary in the first place. Of course, if only one job is at risk, then you can narrow down your selection to a single employee. But if your company is being restructured or a department is being downsized, your pool will consist of everyone involved in that area of the business.
- Define your selection criteria
Now that you have created your selection pool, you now need to work out the criteria you will use to decide who to make redundant. You need to ensure the criteria are objective and measurable, rather than based on personal opinion. Examples of fair selection criteria may include:
- Standard of work and/or performance
- Skills, qualifications, and experience
- Attendance or disciplinary record
Your company may already have written selection criteria in place, in which case, you have an established framework to use. You should not deviate from this without good reason. Alternatively, you may be able to use length of service to help you decide, i.e. last in, first out. However, this may be seen as age discrimination if you use this as your only criterion.
- Apply your selection criteria
Once you have identified your selection criteria, it should be easy enough to apply it. Score each employee in the selection pool against the relevant criteria, and this will help you decide who to make redundant. Bear in mind, you will need to use a fair bit of judgement to help you in this task.
If you need further redundancy support or HR support, do not hesitate to contact us at Harwood HR solutions on 0203 936 9171 or send us an email to info@harwoodhrsolutions.co.uk.
If you need HR support from a company that understands the needs of your business, contact us today. At Harwood HR we can support your business, help you to grow and promote your employees’ talents. Our UK-based team offers a range of HR support services and advice for SME businesses, including outsourced HR support.
