CHAPTER 14

Redundancy

Redundancy

Overview

We begin by looking at the statutory definitions, then consider the rules concerning offers of alternative employment and the opportunity for the employee to make a decision about them.

Finally, there is an examination of possible unfairness in the redundancy process.

Employees are to be regarded as redundant if the employer has ceased or intends to cease carrying on the business for the purposes for which the employees were employed, or if in the place where they are employed there has been, or will be, a diminution in the need for work of a particular kind.

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• It is important to understand just what is meant by a place of employment and by work of a particular kind.

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Determining what constitutes the place of employment

The place where an employee was employed does not mean any place where they could contractually be required to work. The question is the extent or area of a single place, not the transfer from one place to another.

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• If there is no express term relating to mobility in the contract of employment, the tribunal will have to consider whether one should be inferred.

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Determining ‘work of a particular kind’A change in the time when the work

is to be performed will not give rise to a redundancy payment, nor will a reduction of overtime if the work to be done remains the same.

However, both the work that the employee actually carries out and the work that he or she is contractually required to do will be considerations.

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Alternative employment

The burden of proof is on the employer to show that any offer of alternative employment was suitable and that any refusal by the employee to take it was unreasonable.

A trial period may be invoked to consider offers of alternative employment if there is likely to be a difference in terms and conditions of employment.

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The employer should give as much warning as possible of impending redundancies to enable the union and the affected employees to take early steps to consider alternative solutions or possibly find alternative work in the undertaking or elsewhere.

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Unfair redundancy

It is possible for a dismissed employee to claim both a redundancy payment and unfair dismissal, although double compensation cannot be obtained.

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A redundancy dismissal will be unfair if it is shown that ‘the circumstances constituting the redundancy applied equally to one or more other employees in the same undertaking who held positions similar’ and the reason or principal reason for selection was inadmissible.

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Consultation

An important requirement in redundancy situations is the need for consultation. (There are specific requirements in relation to collective redundancies.) Consultation may be directly with the employees concerned or with their representatives.

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