In the current difficult economic climate, redundancies are becoming common and employers need to be aware of redundancy law.

If you run a business and are considering making one or more of your staff redundant, ensuring that you comply with the relevant employment law will minimise the chances of any employment disputes arising. In this article we look at how an employment solicitor can help you when you need to make redundancies.

Considering other options

Making someone redundant is a difficult decision to make so before embarking upon the process, it's worth considering whether any other options are available. For example, can you offer your employees work on another site, or allow them to work fewer hours on either a temporary or permanent basis? If you feel that you may be able to offer employees an alternative to redundancy, an employment solicitor will be able to talk to you about these possibilities and help you to ensure that your proposals comply with employment law.

Redundancies - Consultations and Selection

In order to comply with employment law, you need to follow the proper procedures when making staff redundant. Whether you are making a single member of staff or a large number of staff redundant, you will need to consult them. Your employment solicitor will be able to inform you of the correct consultation procedures to follow.

You should also talk to your employment solicitor about the way in which you intend to select staff for redundancy as the process must be fair and comply with the relevant employment laws.

For example, whilst you can usually take an employee's attendance record, performance and disciplinary record into account when making your selection, your selection criteria must be consistent and you will need to ensure that you don't breach other areas of employment law, such as disability discrimination law. You also need to be aware of the reasons for which an employee could claim that they have been unfairly dismissed. You can't, for example, make an employee redundant purely because he or she works part-time or is on parental leave. Your employment solicitor will be able to discuss what constitutes unfair dismissal with you in detail.

Once you have selected the members of staff that you are going to make redundant, you will need to notify them. Your solicitor will be able to tell you how to do this and help you to draft the necessary letters to ensure that they comply with employment law.

Calculating redundancy pay

When making staff redundant, you will need to inform them about how much they will be paid. Members of staff who have been working for your company for two years or more will legally be entitled to statutory redundancy pay. The amount of money that they should receive will depend upon the number of years that they have worked for you, their age and the amount that they earn.

If you are making staff redundant, you may also need to pay them pay in lieu of notice (sometimes referred to as PILON). The amount of money which they receive will depend upon the amount of notice that you stated that you would give them when terminating their employment in the employment contract that you issued them with when you hired them.

Your employment solicitor will be able to help you to work out what your employees are entitled to. You must also provide each employee with a written statement showing them how their redundancy payment was worked out. Your employment solicitor will be able to help you to draft these letters to ensure that they comply with redundancy law.