Redundancy: Correct procedure = correct result

In order to make a position redundant, it is not enough to be able to satisfy that a genuine redundancy situation applies. This can be an annoyance for employers. However, the Workplace Relations Commission will consider three key areas:

1. If there was a genuine reason for redundancy.
2. Was there a fair selection process.
3. Was there a fair consultation process carried out.

Genuine Reason for Redundancy

Section 7(2)(a) of the Redundancy Payments Acts outlines five grounds under which a redundancy can be deemed as genuine.

These are:

1. Employer has ceased or intends to cease to carry on the business.
2. Requirements of the business for the employee to carry out work of a particular kind, has ceased or diminished.
3. Employer decides to carry out the business with fewer or no employees.
4. Employer decides work being done is to be done in a different manner, for which the employee is not qualified or trained to do.
5. Employer decides that the work being done is to be done by a person who is capable of doing other work for which the employee is not sufficiently qualified to do.

Where your reasons for redundancy fall under one (or more) of the above five it is important to follow through with a redundancy procedure to ensure fair procedure and reduce the risk of unfair selection and any potential unfair dismissal claims.

Selection process

An important factor in the redundancy procedure is the selection criteria. If you need to make a role redundant in a particular area, and you have identified that more than one employee does this same or similar work, then you need to ensure that the method of selection is fair. Whilst no set selection method outlined in legislation, the two main methods adopted are:

1. Last in first out (LIFO).
2. Selection process: For example, an interview or selection matrix where employees are scored against a list of pre-agreed criteria levels of key skills held by employees as well as other work related matters such length of service, disciplinary record, punctuality and absenteeism where relevant.

Consultation process

The redundancy process in general is advised to be carried out over a two week period (when not a collective redundancy). The first step is to have a meeting with all employees who are affected. Inform them that they're ‘at risk’ of being made redundant and covering the following, inform them of:

1. The proposed redundancy.
2. The procedure you are going to follow.
3. The selection criteria you intend to use.
4. Discuss alternatives that you have looked at and also ask employees have they any suggestions.
5. The opportunity to apply for voluntary redundancy should they wish to request same.

After this meeting, the employees should be issued with an 'at risk' letter. Following on from the first meeting, you would hold further meetings with individual employees to discuss any updates or any suggestions they may have. Where no alternative to redundancy can be found, having consulted with the employees regarding the above points, then in the final meeting employees will be informed whether or not they are being made redundant and what redundancy payment they will be paid if they're entitled to one. Employers are then required to issue them with their formal notice of redundancy.

Conclusion

In the context of a redundancy procedure, the WRC has repeatedly stated that the provisions of section 6(7)(a) will only be satisfied where an employer has engaged in effective and meaningful consultation with the employee through a series of meetings. Decisions on this matter include Barton -v- Newsfast Freight Ltd. (UD 1269/05) and Gerry Fennell -v- Resource Facilities Support (2011) 22 ELR 26.

If you would like further complementary advice on redundancy procedure from an expert, our advisors are ready to take your call any time day or night. Call us on 0818 923 923 or request a callback here.