How to run a redundancy programme well

How to run a redundancy programme well

At the time of writing, we are part way through month 3 of the furlough scheme. Attention is now moving away from getting employees furloughed to what happens next. But what happens if you don’t feel you can continue your business in it’s current format? In that case, you may be wise to start thinking about commencing redundancy consultation sooner rather than later. If so you may be wondering how to run a redundancy programme well. Read on….

How to run a redundancy programme well - Planning

Thinking about redundancy can seem like you’ve failed. But it needn’t be!

Redundancy

Sometimes a crisis can force you to make a decision between something that is good and something that could be better. A short term cut back could lead to long term growth.

Before commencing redundancy consultation, it’s good to have an idea of the end goal. Not so fixed that it makes the consultation process a tick box exercise, but a coherent plan of what the future needs to look like and why. Just remember that the definition of redundancy is as follows:

  • wholly or mainly attributable to the fact that your employer has ceased or intends to cease to carry on the business for the purposes of which you were employed, or in the place where you were employed; or
  • the fact that the requirements of your employer for employees to carry out work of a particular kind, or for employees to carry out of a particular kind in the place where you were employed have ceased or diminished or are expected to cease or diminish.

What are the risks of getting redundancy wrong?

It’s critical to manage a redundancy programme well, not just from a legal perspective but also for the people who are directly (and indirectly) involved in the process.

How to run a redundancy programme well

Managed incorrectly, a redundancy process can lead to financial penalties as well as reduced morale for the staff that remain. ‘Survivor syndrome’ can be a hazard of any redundancy programme but if those who remain with you feel that those who have left were treated fairly, they are more likely to be motivated for the future.

Financially, if consultation is not completed in line with the regulation, there is the risk of a claim being made for a protective award. This can be as much as 90 days pay for all impacted employees. So it pays to do consultation correctly in order to run a redundancy programme well.

How to run a redundancy programme well: Consultation

Depending on how many people you may be making redundant, you may need to consult collectively and individually. Alternatively if less than 20 people are impacted it is just individual consultation that is required.

How to run a redundancy programme well

 If you have more than 20 people leaving your organisation within a 90 day period, you are obliged to collectively consult for at least 30 days. But this can also include people whose roles are changing and also any TUPE‘s which may result from the change programme. 

If you are in doubt as to whether you will reach the threshold for collective consultation, it is a good idea to include it in your plans if you want to run a redundancy programme well. Also use this time to think about alternatives so you can avoid making redundancies. You can use the consultation time to seek ideas from those involved.

How to run a redundancy programme well: Don't forget the people!

How to run a redundancy programme well

Although the key driver may be financial, in order to run the redundancy programme well, you shouldn’t lose sight of the people aspect of the change. The key principle here is to be clear and transparent about the reasons behind the redundancy.

Whilst people might not like the proposals, they will understand them if you do the following:

  • be clear & open about the reasons
  • be objective & fair when deciding on how to select employees for redundancy
  • fully brief & prepare yourself / your managers on how to best manage the process

How to run a redundancy programme well - communicate, communicate, communicate

How to run a redundancy programme well

How an employee feels they have been treated, rather than the outcome itself, will count most in their mind and can affect how they accept the changes and move forward. 

It’s critical to keep your people informed throughout the process and manage the change in a careful and sensitive way.

Communication is key – keep your employees informed throughout (depending on the number of redundancies to be made, there are different legal timeframes & requirements for consultation)

How to run a redundancy programme well - don't stop when the project does.

Coronavirus Job Retention Scheme hub

If possible, look at ways to help those leaving to find jobs outside your organisation. This could involve you offering free interviewing skills / CV checking sessions over lunch.

Also be mindful of not only those directly impacted by redundancy but also the ‘survivors’ (those left behind afterwards. They might struggle with motivation and being engaged. Some form of team session to address this and improve engagement can be useful.

Need help with your redundancy process?

Nicci Birley, Rob Birley. Cornerstone Resources

We are currently advising businesses and charities with their redundancy programmes.

 So whether you need to consult individually or collectively, we can guide you through the process. Contact Rob on 07494 161169 or Nicci on 07908 875146 for an initial consultation. Alternatively click here to contact the office.

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