Redundancy Selection Process
26th Nov 2010
Redundancy Selection Process
No one likes to think about redundancy but in these difficult economic times it is perhaps inevitable that some jobs will go as companies are forced to cut back.
For employers, ensuring they are familiar with the formal process that needs to be undertaken when considering redundancy is vital.
Even if they believe they know the law as it stands, a recent case regarding the redundancy selection process means employers may need to look again at their procedures.
Employers must hold a fair consultation in their selection of people for redundancy. This usually means having a point scoring matrix system against which employees are measured, and decisions are taken on individuals as a result.
A recent Employment Appeal Tribunal (EAT) judgement looks set to alter how employers might have to share this information.
The case involved the selection of an employee for dismissal on grounds of redundancy. The EAT found the employer, a printing company, had failed to conduct adequate or effective consultation with the employee by failing to provide him with an adequate explanation of why he had received lower scores than two other people in the pool for redundancy.
At the appeal, the company argued that employers were not obliged to justify the scoring and claimed that it is not generally required for an employer to produce individual assessments of employees and discuss those with them.
The employee’s barrister argued that in order to dismiss an employee for redundancy fairly the employee consulted must be able to understand the basis upon which the decision is taken; they must be given sufficient information or explanation for why they have been marked down in a scoring exercise and be given the opportunity to challenge the scores given to them.
Although the company’s scoring matrix had a column for ‘justification/comment/example of performance’ no comments had been made on any of the scoring sheets and no evidence to support the scores, such as appraisals, was presented as evidence.
The EAT ruled that fair consultation in a redundancy exercise involves giving an employee an explanation for his scoring and a meaningful chance to comment on the scores.
The case highlights the importance during a redundancy consultation exercise, particularly with subjective criteria, of providing sufficient and adequate information which employees can understand, and providing an opportunity for them to argue their case.
Redundancy is a critical area of employment law so any business owners in doubt are advised to seek advice urgently and before they take any steps.
* Paul Hargreaves is a specialist in employment law with BHP Law. He can be contacted on 0191-221 0898.
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