Transferring from one organisation to another is quite daunting at the best of times, employer and employees don’t know what to make of each other and need to establish the working relationship, but what happens when there is the possibility of redundancies.
Most organisations understand the principles of TUPE and that the transferring employees shouldn’t be disadvantaged by the transfer. However, where redundancies may be involved, I have been told by business owners that it’s TUPE and they can’t make them redundant; that we don’t have roles for them here so they can’t transfer; I know my staff, so they’re not at risk: there is a lack of understanding of what employers can do in this situation.
Organisations can make employees redundant where they have transferred in but they need to be able to demonstrate that there’s an economic, technological or organisational (ETO) reason for the potential redundancies.
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If the employees belong to the entity that is transferring, they transfer with it and then, providing an ETO reason applies, you put the roles at risk of redundancy. The principles of the redundancy procedure and how to apply it are then exactly the same as in any other circumstances:
- Identify what the business requirements are and that there is an ETO reason to consider possible redundancies and how this will affect the employees
- If you plan to make less than 20 employees redundant the statutory consultation requirements do not apply, however, there is requirement to undertake reasonable consultation and meet with individuals. Consultation allows all those affected to fully understand the situation, ask any questions that they have, and put forward any alternative ways of achieving the organisations aims
Make sure employees understand:
- The reasons for the proposals (business decision)
- The numbers and roles proposed to be made redundant
- The total number of employees from which those to be made redundant will be chosen
- How employees will be selected for redundancy
- How the redundancies will be carried out and the timescales
- How the redundancy payments will be calculated
Complete a review of all the information provided during the consultation period before making any final decisions, wherever possible redundancies should be avoided.
Having reviewed all the information and made a decision, you need to notify employees of the outcome. If a role is to be made redundant, then it would be appropriate to follow the ACAS dismissal procedure, but don’t forget to inform employees who’s roles have provisionally not been selected for redundancy – you can’t fully confirm the decision until after any appeals have been heard and decisions given
If they are required to work some or all of their notice, they will be eligible to reasonable paid time off for job hunting.
Where you have a pool of candidates from which you will be selecting, how do you do this fairly and objectively where you only really know the capabilities of some of the affected employees? You need to use as much objective information as possible, look at sickness absence and discipline records, work experience, appraisal records, but if you have individuals transferring in from different organisations, there may be inconsistencies in this data so consider asking employees to provide a written statement of how they meet the required skills, knowledge and competence for the role.
It’s important that all the employees have the same opportunity to provide this personal statement and in a consistent format, so make sure that they all receive the role specification, and that what you require back is clear and provide documentation for them to complete. In this circumstance you will be using the best principles that are used in the recruitment and selection processes.
At any time, making employees redundant is emotive and can damage the relationship between the employee and the organisation, but where this hasn’t been established it’s even harder.
Communication is absolutely key, be open, honest and transparent, make sure that employee’s feel that the consultation is meaningful and that they really have a voice, listen to them. If they have alternative ideas, review them and if at all possible incorporate them into your final decision, if you can’t explain why not, don’t just dismiss it.
Keep everyone updated throughout the process, be available to discuss concerns, not just during consultation meetings, and recognise that support needs to be provided.
Don’t cut corners just because it feels difficult, it could damage the long term relationship with employees who remain with the organisation after the redundancy process has been completed.
As with all redundancy procedures, you need to work with those that survive the process. You are going to have to work hard at integrating the remaining employees, rebuild trust so that you can all move forward together.
Peta Fry, HR Director, Monahans
Leading on developing Monahans HR consultancy service to clients, ranging from providing day-to-day operational HR support, managing a complex case load, designing policies, procedures and contracts to organisational development projects, designing appraisal schemes, and coaching and development consultancy projects.
