Getting selection for redundancy right

A quick recap of the main things to consider when deciding how to fairly select during a redundancy process. 

HR professionals understand that this is a devastating situation for employees and it is important to be as fair, transparent and professional as possible.

Methods of selection

A method of selection should be chosen after taking into consideration the specific needs of the business at the present time. In the event of a business restructure that results in the reduction of existing roles but creation of new roles, selection by interview for newly created roles could be your chosen method. 

If the need for existing roles reduces but with no significant change to roles, a selection criteria matrix should be deployed which assesses employees against selection criteria agreed through a process of consultation. The Company still retains the right to make a final decision on the criteria to be used.

Use of interviews

Assessment of an employee against interview criteria can be carried out by a manager following an interview with that employee.

Following the interview each employee should receive a score for which they will be ranked accordingly. This will enable the Company to identify who will be selected for redundancy on a provisional basis.  

Use of a redundancy selection matrix

Employees can be assessed against objective criteria determined by the Company using a grading system. The matrix will outline the scoring ranges and weighting for each criteria. 

Employees will then be scored in line with the criteria and awarded a final score. This will result in them being ranked accordingly and ultimately identify who will be selected for redundancy on a provisional basis.   

Pooling

The Company should, from the outset, outline which roles are at risk of redundancy and the number of redundancies deemed necessary. From this the Company will be able to identify who is to be selected for redundancy. 

Once the Company has identified the roles affected by the redundancy, an appropriate pool of employees should be formulated from which those to be made redundant will be chosen. The pool will be identified using various factors, including the employees’ area of responsibility, where they are based or normally work.

The pool will not normally be restricted to only those employees performing the type of work affected by the decision to make redundancies. It is common practice for the redundancy pool to involve employees who perform the same, similar or interchangeable work. 

Selection criteria

The criteria to be applied will include a range of criteria which allows for objective scoring. This enables the Company to undertake a fair selection process where evidence can be relied upon should a decision be questioned. 

Some or all of the following are examples of objective criteria which employees may be scored against:

  • performance
  • skills, competencies and qualifications
  • disciplinary record
  • attendance (excluding absences due to pregnancy, maternity, other family-friendly leave or disability)
  • other relevant work experience.

The specific selection criteria the Company wish to use will take into careful consideration current business requirements. It will account for specific skill sets, knowledge and a need to create an environment in which the Company may prosper. 

Consultation

Where collective redundancies are proposed (20 or more redundancies at the same establishment over a 90-day period) consultation with trade union representatives (where a union is recognised)/employee representatives (where no union is recognised) will be undertaken with a view to agreeing the pool and specific criteria to be used. 

Consultation will be undertaken on an individual basis in a non- unionised redundancy situation. 

The Company should endeavour to formulate a set of agreed criteria through consultation, however, it holds the right to make the final decision on the criteria to be used. But if this is agreed with employee representatives the process is much smoother.

Scoring 

Those with the responsibility of undertaking the scoring exercise should do so fairly and objectively and ensure their decisions can be supported by evidence. 

Where possible at least two managers should be involved in the scoring process. This may be done by taking a combined approach to scoring, in which case one set of scores will be produced, or alternatively two sets of scores will be produced which are then added together and an average score subsequently calculated. 

Compliance with the Equality Act 2010 may require some scores to be adjusted to avoid unfair treatment and/or discrimination. Disability related absences may be discounted when determining an employee’s score against the attendance record criteria by way of reasonable adjustment. 

Provisional selection/employee representations

A provision determination on selection for redundancy should be made subsequent to the scoring exercise. 

Employees should be informed of their position in the scoring matrix at individual consultation meetings and afforded of the right to bring a companion. 

Employees should be able to challenge their scores or offer additional information which may be appropriate for the manager to consider when ultimately making the decision on who is to be made redundant.

Careful consideration should be given to any evidence and time factored in to allow representations to be made before the Company reaches its final decision.

Notification of selection for redundancy

Formal meetings should be arranged in order to inform employees that they have been selected for redundancy at which an employee will have the right to be accompanied by a colleague or trade union representative. 

Arrangements for the termination of their employment and their entitlement to redundancy pay should be covered. The arrangements discussed at this meeting should be confirmed in writing.

Employees selected for redundancy should always be given the right of appeal and ideally this will be conducted by someone uninvolved in the original process. Consider using an external HR consultant as if something has gone a bit awry, better to identify and correct it than focus on supporting company decisions at all costs.  

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