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A fresh look at redundancy

Rightsizing, downsizing, normalizing, delayering all often lead to the inevitable – redundancies! As much as some companies try to disguise or avoid it, redundancy is sometimes unavoidable, but your approach can make all the difference. Article by Carol Smith, Senior Employment Consultant at Croner.

It may seem an odd place to start, but being creative when recruiting can help at a future time of redundancy. Ideally, it’s about trying not to get into the situation in the first place. You need to think long-term when planning your people and resources.

Things to do now that can help avoid redundancies later:

• Offer flexible contracts, enabling you to move people around
• Recruit multi-skilled people that can be redeployed on other work
• Hire flexible resource to support your core team
• Review the balance between permanent and temporary resource regularly
• Do you really need to hire a permanent employee or could you use a temp?

So, a more creative recruitment approach and thinking ahead can really make a difference. Introducing zero hours and annualised hour contracts are also employment practices that can smooth the business peaks and troughs. Flexi-time too, has its place, but you need to be careful about how you use it and check with an HR expert first.

Sound and objective selection criteria is critical

No matter what you do, every so often redundancy is the only option. However, it can sometimes be viewed as a process of getting to the right numbers; either people or pounds. Yet, a ‘carte blanche’ approach can end up with lost talent.

Choosing the right selection criteria is imperative to make sure you keep the right people. Good record keeping is also vital, to guarantee you have powerful information at your fingertips. The ‘criteria’ you choose have to be clearly identifiable, measurable and objective. You also need to have information that backs up the decisions you make in case you are challenged at any point. If you are too focused on the process things can get overlooked. Making sure you have sound and objective selection criteria is critical to avoid some redundancy pitfalls.

Be aware of case law

You may be very familiar and confident with the whole redundancy process, but you need to stay up to speed with the latest case law. Recent Case Law highlighted the potential risk of discrimination in selection processes, for example if using a scoring matrix based on criteria such as attendance record, disciplinary record or standard of work performance,after a woman on maternity leave received a full score during her leave absence and as a result, a man scored according to his performance, lost out and lost his job. Employers need to be mindful of emerging Case Law, how this affects process all the time and is ever evolving.

Collaboration, communication and consultation in redundancy

Effective consultation and communication is critical when going through the redundancy process. The foundation of redundancy is to mitigate the effects that it creates, while carrying out the process. Properly informing your people with a strong business case and valid reasons for redundancies will help the consultation process run more smoothly.

Keep an open mind at the consultation stage. It is all too easy to go in with a closed mind. Employees need to know that they are being listened to and that alternative suggestions are properly considered. They may come out with inventive solutions that you had never considered.

Ultimately, you could be challenged on your decision and have to explain why you didn’t take on board their solutions.

Be careful not to overlook what may seem obvious

Usually redundancies are driven from the top down in a business. Sometimes, though redundancy can be driven from the bottom up and used to disguise losing people that have issues that should be dealt with through effective management. When going through the process, don’t overlook what may seem obvious – have you asked for volunteers? These are people that for different reasons may be happy to leave your business. You also need to be careful to consider some of the potential discrimination risks in selection criteria, particularly around disability and pregnancy.

Everybody is affected

Redundancy is part of the ebb and flow of business, but can be avoided with forward thinking and effective resource planning. Don’t approach it with preconceived ideas. Be clear, follow procedure, but above all listen. Everybody in the business is affected when redundancies take place. Keeping good lines of communication flowing and not overlooking some of the obvious steps will help. People left in your business will take into consideration how you have dealt with redundancy. So, although avoiding redundancy is what we all hope for, how you deal with it can make all the difference now, but also for the future of your business.

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