Redundancy law specialists

Redundancy doesn’t have to be a legal headache. We make sure everything is handled fairly, legally, and with minimal stress.

Managing redundancy exercises

If correct process is followed, an employer can dismiss an employee by reason of a redundancy or restructuring and avoid paying out on employment law claims.

If, as employer, you fail to follow the correct redundancy process you risk an unfair dismissal or discrimination claim plus paying out compensation.  Even worse for employers is being dragged through the Employment Tribunal, risking adverse publicity.

Our employment lawyers manage collective redundancy exercises and deal with execution by the employees of multiple settlement agreements.  We also deal with difficult situations, redundancy appeals and allegations of unfair and/or discriminatory selection for redundancy. Please do get in contact.

Making employees redundant

We are specialist employment law solicitors and have dealt with a lot of redundancy situations for employers. This translates to cost savings for you as we can quickly determine how best to proceed.

  • We cover all the areas you will need. We help you to document and justify your decisions in a way most likely to avoid an employment law claim.
  • We can meet a short notice at our central London offices. You will be looked after by a partner.

Fair reasons for redundancy

A “fair reason” for an employee dismissal by reason of redundancy, is  a reason that is wholly or mainly attributable to the business:

  • Ceasing trading;
  • Relocating; or
  • Requiring fewer employees for a particular task.

How to prepare to make staff redundant?

The key is :

  • appropriate consultation with employees; and
  • looking at any suitable alternative options to redundancy.

Before making staff redundant, it’s generally key to prepare and we recommend the following for employers :

  • Clear written redundancy procedures – these often form part of an employment or staff handbook and by having your process in a handbook it will not be part of the employment contract which should make it easier for an employer to update.
  • Ensure you create a pool of employees potentially at risk – generally an important part of good practice.
  • Give employees notice of potential redundancy – ensure employees are given sufficient warning of potential redundancies.
  • Consult with employees at risk – listen and document.
  • Selection criteria – make these objective and carefully considered, be consistent and document everything.
  • Alternatives to redundancy – ensure you look at all possibilities and document your process.
  • Redundancy employee right to appeal – ensure you communicate the right to appeal and follow the process involved.

Getting the redundancy process right

Many employers use us to help draft the communications with potentially  redundant or restructured employees. The right message has to be conveyed and obtaining agreement can make the process much easier. See also our employer guide to redundancy rules and process.

Employers who will make over 20 employees redundant in a 90 day period are obliged to consult collectively with employees. A failure to follow collective consultation can lead to penal damages awards of up to 12 weeks’ pay per employee.

See also our more detailed guide to making a large number of staff redundant.

Redundancy payments 

Employees who are dismissed by reason of redundancy may be entitled to a statutory redundancy payment.  The government increases statutory redundancy annually which depends upon the number of years of service and the employee’s age.   Additionally, there may be an express or implied contractual right to an enhanced redundancy payment.

Redundancy notice

There are process requirements when considering staff redundancies. The correct notice of potential redundancies, usually in the form of a letter to employees, is very important both in terms of process and form.

Please get in touch.

 

Let us take it from here

Call us on 020 7438 1060 or complete the form and one of our team will be in touch.

Alex Kennedy

We work with employers to help them navigate the redundancy process.  Fear of claims in the Employment Tribunal coupled with the employment costs mean redundancy situations can be difficult.  Tricky cases need to be dealt with without opening the floodgates.  Sometimes before the employer gets to settlement agreement stage help is needed in managing the situation and expectations which is where we step in.  Settlement agreements are bread and butter to us.  We have run collective redundancies where many employees are being made redundant for employers to secure that the employees sign up to their settlement agreements and everything is compliant.

Making employees redundant

Recent experience

I wanted to know do I have to pay a bonus to employees being made redundant?

We worked with a client making selected redundancies of employees who were entitled to discretionary bonuses. The bonus year had not quite finished but by the time the consultation period elapsed it would have finished. There were concerns over claims for constructive dismissal and unfair selection for redundancy. Alex was brilliant in deconstructing the situation and providing the basis on which to make decisions that would stand up to scrutiny. The exercise was successful.

What happens to shares held by the employee.

The employee held shares in the business but we wanted the shares back upon redundancy to re-use for other employees. The team reviewed the articles of association and confirmed that we had sufficient power to force the sale of shares. They proposed a way to buy back the shares tax efficiently by way of a share buy back route which worked very well for us.

I am selling my business and need to make redundancies but retain key staff.

The employer was worried that when the employees discovered plans to sell the business the good ones would leave. We worked on a strategy for them to provide enhanced contractual redundancy payments to key employees we wanted to keep for the sale process.

Can you handle my collective redundancy exercise?

Jason helped us deal with a collective redundancy process affecting 25 employees. There was a tight deadline to meet. Jason:
• Reviewed 25 settlement agreements within a short time frame, ensuring each met the necessary legal standards.
• Provided remote legal support to allow the service to progress efficiently without delays.
The desired outcome was achieved.

Redundancy support from beginning to end

Alex helped a national retailer undergoing a significant restructure, which required a collective redundancy process affecting 60+ employees across multiple locations. Our client needed legal guidance to navigate the complexities of the process, including compliance with collective consultation obligations and the preparation of settlement agreements.
Our approach

• Working with the HR team we dealt with the consultation requirements: We guided our client on their legal obligations regarding collective consultation, including advice on electing employee representatives and conducting meetings.
• Following up on the outcome of the consultation we drafted settlement agreements providing consistency and legal compliance across the board.

The process was completed successfully, with all 60+ employees signing their settlement agreements without issue.

Help - I have 40 settlement agreements to get signed up

Our firm was approached by an employer facing a collective redundancy situation involving over 40 employees. Specifically, they needed assistance with reviewing more than 40 settlement agreements within a tight timeframe to ensure compliance with employment law and to protect their business interests.
Our approach:
Understanding the urgency and complexity of the task, our employment team swiftly mobilised to provide legal support. We collaborated closely with the employer’s HR team, ensuring clear and efficient communication throughout the process. Our work included:
• Comprehensive review of the process for redundancy.
• Practical advice on how to get it done smoothly.
• Minimising disruption to the employer’s business operations.

What our clients are saying

Testimonials

Gannons' service for redundancy

Good, comprehensive & helpful service. Alex Kleanthous explained all the details about redundancy settlement in a clear & understanding manner.

Redundancy Settlement

I contacted Jason Pradhan after I was made a redundancy settlement offer from my then employer. Jason was very professional and patient with me as I asked questions. I came away feeling I had a good understanding of what I was signing and I was happy to proceed. To make things even better the whole thing was turned around in less than 24 hours