Redundancy is unavoidable, but employers have to make ensure the criteria they are basing your redundancy on are fair and not based on any criteria deemed unfair.
In this instalment, we’ll explore why redundancy is necessary and the considerations that employers need to make when using furloughed staff as redundant.
Redundancy is only an option if the employee no longer needs their position. This usually happens when their role becomes unnecessary.
If a few situations qualify as redundancy, they include the following:
The employer no longer needs your skill-set
We realise that a reduction in personnel might be necessary. This could be due to reduced demand for your business’s services or the specific skillset of an employee is no longer needed for future work.
New systems have been implemented
If a new processes have been introduced that means the employee’s job is no longer required, redundancy may be used. But, introducing a new process doesn’t mean that an employee is redundant.
The work has been allocated elsewhere
Another reason employees could face redundancy is if their job is no longer needed because it has been taken on by others.
The company will be terminating
Typical situations where redundancies can happen is when a company closes down. The reason for this is that these companies may need to make significant changes in order to remain profitable and competitive.
Business is moving to another location
If you relocate your business to a new area, you may need to reach out to an HR specialist for assistance with determining whether or not the employee is redundant.
Why you may face a fair redundancy
It’s worth pointing out that how long someone has been employed cannot be the only factor taken into consideration by employers when deciding if they are redundant. Last employed, first to go policies are sometimes called age discrimination because they disproportionately affect younger employees.
Employees with qualifications should be considered for redundancy but they are not the defining factor.
In the event of an employees attendance record or punctuality being a reason to make someone redundant, employers should take care not to discriminate against employees with disabilities.
Employers who want to make their employees redundant can be held responsible and even face legal action if the individual was done so in a discriminatory manner. If the reason for redundancy is justifiable, you can feel more confident about your decision.
In light of this, it’s crucial that managers act fairly and consistently. That means making all decisions using evidence in the written form, like sick notes, performance appraisals, or disciplinary records. Doing so will ensure that all employees are treated the same.
It’s also advisable to have more than one person involved in each assessment. These people should be familiar with the employee and their performance history, it’s pivotal that this is done well.
Redundancy can be seen as unfair if a worker was selected in regarding any one of these criteria. See our redundancy guide for more info on what happens in this situation.
This is what’s considered an automated unfair advantage. If you are making redundancies, the one exception to giving a reason is when it’s not the primary reason. So if employees have been made redundant due to restructuring then this wouldn’t be unfair unless one of the factors listed were a factor in an employee being selected for redundancy.
Terminating after September 2021, the furlough initiative has helped companies help workers through tough economic periods.
There’s been a lot of uncertainty with the federal shutdown over recent weeks and employees who have been furloughed but with pay may be wondering what they can do.
Personally, I don’t think it’s fair to put someone on furlough and then make them redundant. Furloughed staff are eligible for the same redundancy package as everyone else, and still receive their entire pay while on their notice period.
As they are still employed, federal staff are legally entitled to the same rights as any other employee. They also enjoy fair redundancy and protection against discrimination and unfair dismissal.
As a precautionary measure, employers should evaluate all other alternatives before deciding to either make furloughed employees redundant or allow those who have worked for the business for more than two years to present a claim for unfair dismissal.
Supporting you through redundancy
Accessibility of employment law has never been more prevalent, meaning that employees are more likely to realise when their employers don’t follow the correct redundancy procedure.
If your organisation is considering layoffs or has already done so, we can make sure that you are familiar with legislation to ensure the process is fair. They’ll also identify legal issues and make sure whatever process you put in place is lawful.
Our expertise can also help businesses navigate the difficult process of furloughed staff becoming redundant.