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Retail Sector Facing Challenges

A study by the Resolution Foundation thinktank has found that retail has the highest redundancy rate of any sector of the economy.

Many retailers are facing tough trading conditions with changing spending habits and a move to on-line shopping having an impact on those who operate brick and mortar stores. To address such challenges some employers may be considering taking steps which will affect employees such as reducing employee numbers, closing stores or proposing changes to employee’s terms and conditions.

If you are considering taking such steps in your business remember Kingfisher* is here to help you. We can provide practical advice and guidance on your situation from the planning stage right through to the conclusion of the process.

As employers often find it helpful to have an idea of some of the key points to think about when it comes to redundancies or changing employee’s terms and conditions, we have put together some fast facts below. However, it’s important to contact us for advice on the specific facts of your case before taking any action.

Redundancy

If you are considering making redundancies, bear in mind that you will usually need to:

  • Have what in law is considered a genuine redundancy situation. For example, you are shutting down a store or fewer people are required to do the job.
  • Identify the appropriate selection pool. This is the group of employees that are at risk of being made redundant. Depending on your business reasons, you may be proposing to make all of those in the pool redundant, or only some of them.
  • Fairly select who will be retained from the selection pool, unless you are proposing to make all employees in the selection pool redundant. Selection is often done using a skills matrix, this involves you identifying selection criteria and scoring employees on their performance in these areas.
  • Look for alternative employment. A failure to do so can make a redundancy dismissal unfair.
  • Warn and meaningfully consult employees who may be affected by the proposed redundancies before any decision to dismiss is made. This is irrespective of the size of your business. Bear in mind that if you are proposing to make 20 or more redundancies within a 90-day period there are additional collective consultation obligations that will need to be met.
  • Pay redundancy pay to those employees who are entitled to it.

Whilst you may need to make a lot of difficult decisions in business, we understand that one of the toughest may be to propose redundancies in your organisation. If this situation occurs, Kingfisher* can be there to help you through it.

Changing employees’ terms and conditions

If you are considering making changes to employees’ terms and conditions, it’s important to bear in mind that:

  • You should have a good business reason for wishing to make the change.
  • For most changes, such as an alteration of working hours or the removal of a contractual benefit, it will be necessary to consult the potentially affected employees with a view to gaining their agreement to the change.
  • If the proposed change may affect 20 or more employees, additional consultation obligations may apply.
  • If agreement cannot be reached ultimately you may need to dismiss employees who refuse to agree to the change and offer to re-employ them on contracts which reflect the change you wish to make. This is not something that should be undertaken lightly as it can give rise to the risk of unfair dismissal and other claims.

If you need to make changes to employee’s terms and conditions Kingfisher* can help you throughout the process, from discussing in detail the changes you wish to make to providing practical guidance on the process to follow.

If you have an employment law matter you require assistance with, please do not hesitate to contact us as we are happy to help.

 

 

*Kingfisher refers to Kingfisher Professional Services Ltd