An employer is under a duty to consult employees about the potential redundancy situation at an early stage, before notifying them that they are to be dismissed for redundancy.
The purpose of is to consider alternatives to redundancy which may include:
- offering voluntary redundancy or early retirement
- transferring to staff to fill existing vacancies elsewhere in the business
- offering to train staff to gain new skill sets which will be more pertinent to the future of the business, and/or
- offering the opportunity to job share
The period over which consultation takes place is determined by the number of employees effected. Employers who fail to comply with collective consultation obligations are at risk of claims for a protective award. This award can be as much as 13 weeks’ pay for each affected employee.
Where there are less than 20 employees, the employer is not restricted by the statutory requirements of collective redundancies. However, it is good practice to consult employees at an early stage. Early consultation will allow alternatives to be fully explored and thereby reduce the risk of claims of unfair dismissal.