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Collective Redundancies

Many employers will be in the processes of assessing their staffing needs, sadly for some this may lead to them considering the possibility of making redundancies.

Whilst most employers are aware that it’s important to carry out a fair and appropriate redundancy consultation process for employees who have over two years’ service (see our earlier Legal Update Redundancy Fast Facts for background information), it may come as a surprise that depending on the number of redundancies proposed, additional collective consultation rules may apply. This is the case where an employer is proposing to make 20 or more redundancies at one establishment within a period of 90 days or less (known as ‘collective redundancies’).

It’s important that employers in this situation effectively and appropriately plan ahead to meet their additional obligations. Below we look at some useful facts when it comes to collective redundancies and collective consultation:

1. Employee representatives will be required

In a collective redundancy situation, employers are required to consult appropriate representatives of any of the employees who may be affected by the proposed dismissals or may be affected by measures taken in connection with those dismissals.

For most employers who don’t recognise a trade union, this will usually mean they will need to hold an election to get appropriate representatives specially appointed. There are rules that need to be adhered to regarding this, principally to ensure that any election is fair, but this is not as daunting as it may sound as advice and support regarding this is available from Kingfisher Professional Services Ltd.

2. There is a minimum consultation period and certain matters must be covered

Once representatives are in place, the employer must give them certain information in writing. This includes the reasons for the proposals, the numbers and descriptions of employees the employer is proposing to dismiss and total number of such employees at the workplace and the proposed selection method. The required information forms the basis of consultation with the representatives.

Collective consultation must, as a minimum, cover ways of avoiding the need for dismissals, reducing the number of dismissals and mitigating the consequences of the dismissals. Employers should consult with an open mind on all the relevant topics when proposals are still at a formative stage. If the employer only begins consultation when they have already decided on redundancies, they are likely to be found to have breached their consultation obligations.

Consultation must start ‘in good time’ to allow the relevant discussions to take place and a minimum period before the first of the dismissals takes effect. The minimum periods are:

  • 30 days where between 20 and 99 employees are to be dismissed
  • 45 days where 100 or more employees are to be dismissed

It’s also important to bear in mind that individual consultation with employees is also likely to be required in many cases for redundancy dismissals to be fair. Kingfisher Professional Services Ltd can provide advice on all aspects of the redundancy consultation process.

3. The ‘HR 1 Form’

Employers have a duty to notify the Department for Business, Energy & Industrial Strategy (BEIS) if they are proposing collective redundancies. This is done by providing the required information to BEIS on form HR1. Notification must be given before notices of termination are issued and at least 30 days before the first dismissal takes effect where the employer is proposing to dismiss 20 to 99 employees as redundant (45 days’ days before the first dismissal takes effect if the employer is proposing to dismiss 100 or more employees as redundant). It’s important to bear this in mind when planning a collective redundancy consultation process.

4. The collective redundancy rules don’t just apply to ‘typical’ redundancy situations

The collective consultation requirements can apply in situations which employers may not necessarily expect, such as where they are proposing to dismiss and rehire in the context of changes to terms and conditions of employment. This is because the definition of ‘redundancy’ for collective consultation purposes includes dismissal for a reason not related to the individual employee as well as what would be thought of as more typical redundancy situations. With this in mind, it’s always important for employers to seek advice on the facts of their case before taking action.

Kingfisher’s Advice

It’s important to seek advice on the facts of your situation as soon as you can if you think you may need to make any redundancies in your organisation or  you are considering taking any other action in relation to your employees. We understand that many employers are facing difficult decisions in these unprecedented times. Kingfisher Professional Services Ltd is here to help, we can provide you with practical advice and guidance on all aspects of employment law.