Webinar
Redundancy: when and how to collectively consult - Live
Redundancy: when and how to collectively consult - Live
Despite the government’s extension of furlough to October, the longer term considerations businesses are taking to remain afloat are more serious than ever. Where collective redundancies (for 20 or more employees) is the only option left, the correct process needs to be followed to avoid appeals and claims in the future.
In this webinar, we discuss the criteria, process and timelines for collective redundancies. There will also be an opportunity for questions which you can forward to us in advance at events@shma.co.uk, or ask live on the day.
Please do let us know of future topics that you are interested in, or for more information about our webinars please contact us and you can view past webinars at SHMA®ON DEMAND.
Jon Heuvel
Partner
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Webinar transcript
(Please note this is auto-generated and un-edited)
0:43
Hello. I'm John Heuvel partner here, and the employment team, and Shakespeare Martineau today. Welcome to today's live webinar on Collective redundancies.
0:52
This is an area that will have some added complications. The moment, given the well, what we're now referring to as the new abnormal coined the phrase that RCA Sarah Smith has used. So what is clinically redundancy? Well, essentially, it's a set of special legislative rules, which apply when a business is proposing to dismiss as redundant, 20 or more employees within a period of 90 days, or less, from one establishment. And it's those three tests, which which trigger the the requirements to be consult.
1:31
one point that probably should mention here is that when we're talking about redundancies in this context, we're not just talking about closures of business or reduction in the number of staff needed. For reasons which I want to explain in detail now. But the legislation actually also encompasses situations where you are proposing to dismiss and re-engage staff as a mechanism for changing their terms and conditions of employment. That is still deemed attractive redundancy, and therefore you will still need to go through to the rules for corrective concentration in those scenarios.
2:12
So just to remind ourselves, in terms of background, photo scheme was first introduced by the Chancellor back in March and that was clearly intended to reduce the need for businesses to have to look at CCE. That scheme has been through a number of revisions over the course of the last few weeks, that most recent of which, being late Friday night, Saturday morning, This weekend. When Government published its details on the new Flexible Fellows Scheme, which will you can, from the first of July, and will allow businesses to start bringing people back into the workplace, to work part-time, while continuing to be followed for the number of titles.
3:00
As a reminder, also, from the first of August, the burden of who bears the cost for further and we'll start shifting away from the government back towards the employer. And I think that is going to lead to an increased likelihood to be statistically to have to look at collective redundancy. Now, just why this is a good topic to be to be discussing today.
3:26
So I think collective redundancy in this current climate probably has three particular challenges.
3:34
More than that, those challenges wouldn't normally exist for just explain what those three are. First 1 is 1, which is always an issue which is question of timing of when redundancies proposed? When does the duty to consult? We kick off. The second one is in relation to representatives.
3:55
Firstly, you've got a question of whether or not elected representatives already exist and if they do, are they available to work for all they actually already further to themselves? The other issue is if you need to go through the election process. How's that going to work, if you've got staff, who also she distanced not physically working in the office for working remotely or more to the point?
4:25
Then the third issue is really an issue, again, relating to those who followed, which we saw the employee representatives themselves could each give them access to the effective workforce. They represent. If that workforce is not available on work credentialed IT systems because their fervent or whatever, then that may give rise to GDPR shoes over keeping our contact details for employees.
4:55
Finally, before we go into the questions, just a reminder that the discharge of obligations under the effective consultation process doesn't automatically avoid the need to do individual consultation. It'll certainly goes some way towards avoiding unfair dismissal claims, reducing risk of them, but it doesn't eliminate them altogether, you still have to go through individual consultation as well. So two processes to me to run in parallel.
5:28
And what we'll do now is we'll start looking at the questions.
5:32
So, I'll start with one question. Hey. We operates two different sites. If we're proposing 12 to 15 redundancies at each site, all the collective concentration regulations triggered, that's a very good question To start and probably hits one of the big complication areas.
5:49
The The two questions really there is in terms of the number of redundancies and also the question of location, in terms of the numbers, as I said at the beginning, it's it's 20 or more employees affected but it's from one establishment.
6:10
So, I think obviously the question here is contemplating that the number at two different sites they refer to is under the threshold and therefore, can they avoid the regulations? This question of one establishment is, is really where the nub of it comes? And it's not as straightforward as that might seem. Because there's a divergence between what the UK legislation says and what the EU directive that it was seeking to implement actually says, the leading authority on this is the cases relating to the Administration Woolworths few years ago. And what is effectively establish there was that the in the cases where the individual shops were separate establishment.
7:03
So, the obligation to collectively consults was triggered for those shops, where there were 20 or more employees was not triggered from small shops where within App Engine, which will show that were less than in individuals'. So, it does require looking at that. Now, unfortunately, it isn't a simpler, simply saying that stroke of the geography. and if it's two different sites, because you need to look at the nature of the organization, the way in which to workforce is structured, you can have a situation where you have employees employed by two different employers working on the same site, with temporary structures. They would not be treated as the same establishment.
7:47
On the other hand, you can have workers working in different locations, but where the structure is such that the courts will regard that as effectively, one single establishment, even though the geography is different. So there is quite a lot of variety in this, in terms of what the establishment is. So the answer to the question is, it's going to depend slightly on what the situation is, something that I'm happy to take offline person, who asked that question, in terms of determining whether or not you would be under the definition of a single establishment.
8:25
I hope that answers that question.
8:30
OK, how many elected representatives do we need to ask for? Well, the answer that question is it's entirely up to you as the employer. There is no hard, and fast rule, it isn't that you have to have a set number of representatives headcount only required to do is to ensure that there is appropriate representation for the workers affected. What our January say is, the fewer represents that you have, the easier it is to manage. Particularly at the moment if you have to do that remotely over two calls or whatever, because it can get unwieldy if you've got too many people.
9:12
But you also need to make sure that you've got sufficient to properly cover the workforce. Generally, if you've got different categories of worker, then I think it's sensible to have 1 or 2 representatives for each category. So if you've got a workforce is typically 2 or 3 different groups of people, in terms of factory floor people and middle managers, and delivery people, for example.
9:40
Then you might have 1 or two representatives for each of those categories. Have six to say there are no hard and fast rules on it, it's really whatever you feel is appropriate.
9:53
Um, Township, because he's got a few other questions still coming in here, John, to just pick one of those.
10:01
We can employees nominate themselves to stand as representative, OK, yeah, essentially, any employee who is potentially affected by the regulations is eligible to stand on that increase individuals. Often, I would say, the easiest way is to have self nomination, particularly at the moment, when individuals are more isolated, it's much more difficult to ask other work colleagues to nominate you, put forward, if you're not actually physically in the same place.
10:39
So, I think, at the moment, in particular, is probably even more relevant, that you have self self nomination, but suddenly S, self nomination is every permissible, OK. And does a representative have to be someone involved in the process or can they be an employee from another area of the business? They can be from another part of the business, as long as they are unaffected employee.
11:09
So, see, you can't have somebody who stands as a representative who isn't affected by potential collective redundancy. But the concept of somebody who is affected by the redundancies is actually why doesn't than you might think. So, for example, if you're proposing to close one particular site and focus the work on a second site instead, we've already got staff and you're gonna make 30 people redundant from the first site and shift work across to another site.
11:46
Obviously the 30 you potentially at risk of redundancies will be affected employees. But so also will be the employees of the second site because they will be facing additional work and therefore, they are affected. And as affected employees, they could be included within the group of people to be chosen for selection.
12:08
And if someone access voluntary, redundancy will not count towards the 20.
12:17
So voluntary redundancy is, will usually count towards the numbers. And suddenly I would always caution people in not trying to treat voluntary redundancies as keeping you down below the number.
12:32
Because of the potential risks, If you don't do collective redundancy when you should, In some situations, and it's nice by no means open, in some situations, it is possible for genuine, voluntary redundancy to be excluded from the calculations. But generally speaking, that's really where the business perhaps isn't looking for a particular number of headcount. It isn't in relation to specific proposed redundancy exercise. It is just an open-ended. There is always an opportunity if people want to apply for voluntary redundancy and here's the process, where in effect will that we call voluntary redundancy. It's a It's in reality it simply a mutual agreement arrangement today. You've in some situations like that it might be possible for them to be excluded from the camps.
13:23
But if you will proposing redundancies and one of your methods for trying to select for that redundancy is to go through the function redundancy. Which is sensible Way to take from then, that would still count towards the numbers.
13:44
Peter and, I remember one, how would you recommend connecting reps when workforces?
13:55
So, this is really where the computation comes, the.
14:02
The election, it's, it has to be done as a secret ballot. It has to be everybody who is eligible to be considered. it has to be allowed to vote, and they're free.
14:16
Person who is standing as a candidate has to be within the affected class.
14:21
Beyond that, the rules are not mandatory as to how you do it.
14:25
The ... guidance, which is not statute binding or anything, talks about, give some suggestions as to how you might do it. The, I would say, really, the starting point is to think about the nature of the employees and whether they have access to systems.
14:42
So if employees are all able to access e-mail remotely, accessing e-mail remotely, then getting a message through that would be a sensible route. Even if the third one assumes Turks, they will be communications with them, sometimes they need to know when they're not being followed. So that would be the way to get the communications to them. In terms of the way in which the balance can be conducted, that's much more difficult to do, their own IT systems that can do it. Probably, the easiest way is to ask an independent Scrooge independent person scrutineer do the counting such as separate from the business. The alternative is simply do it as a postal voting system, but obviously, that has significant disadvantages from a turning point of view because it's going to take a lot longer.
15:44
Today, through an election, by poached, would be using e-mail.
15:51
And another warm tone: can I use these as notice prompts consultation, has been completed.
16:01
OK, so ..., yes, you can subject to the rules of the Fellow's scheme.
16:08
The as long as you're not paying in lieu of notice where you're effectively accelerating. The timing of when payment would be met need it is still possible to use authentic scheme. So if somebody is simply working then notice, but that that process of working actually happens to be through the fallow period, then it's fine to each week. What's your fellow, you can receive a week of niches, pay, that's fine. But, if you're saying that, I'm going to pay, you have noticed, because there's another month just to go, but I'm gonna give you the lump sum for that month now, and then I want to reclaim that through further it won't work.
16:53
OK, thank you.
16:54
And what happens if I have 1 to 20 employees at the start of the process, But then have to increase the numbers on this. OK, so question here is whether or not you have deliberately manipulated the numbers. Whether this is a genuine change your circumstance. The Sara's, somebody sent two schools of thought on this.
17:25
You can't rewrite history since you genuinely don't realize that they're going to be more redundancies. And the first, bactrians is 10, and, therefore, the collective consultation is triggered. And then a little bit further down the line, you realize that actually going to need to make more redundant. The court's view, as well, you can't go back and rewrite the time when you start the 10 to those things already happened. Not from now posing to dismiss those, because that's already in motion. So you count from the starting point of the 20 in the second batch.
18:03
If, however, the view is that actually, the business is deliberately staggering. The redundancies to try and get 'round the collective redundancy rules, If there's any evidence of that, then it will certainly fail.
18:19
So, I think you have to be slightly careful about how you manage that process and whether or not genuinely contemplating more redundancies at the outset. The other point on that question is the other way around, what if you've already got a batch of people, and then you add more today to stage, but the first batch had already started the collective concentration, You don't effectively have to restart consultation.
18:50
You might have to adjust your HR one form that you send to: Secretary of State thought. You don't have to restart the clock on those up for people because that will pump past the original proposed redundancies.
19:07
OK, so if there's no prospect of avoiding redundancies, do we still need to confront? That's a very common question that people ask. In short, the answer is yes. Consultation is not just about avoiding redundancies, Jose. You're also consulting on ways to reduce the impact of the dismissals.
19:35
Way to mitigate some of the circumstances of it as well as looking at avoidant per se. To click, consultation goes slightly beyond just the notion of, can I avoid the redundancies?
19:51
OK, and is it true that we can no longer use the land surface when selecting employees?
20:02
To some extent, yes, it is, but it's not necessarily quite as hard and fast. Rule might suggest that the problem with length of service is that it has obvious age, discrimination, connotations. Somebody who's been in service for a lot longer will by definition be proportionately older. Therefore, it's more difficult for a young person to have gained length of service. And therefore, Delegate goes to an age discrimination factor. However, if we step back and think, Well, what is, why are we asking about length of service flies that matter to us, The reality is, it's probably to do with experience.
20:49
And, therefore, goes to skill set and shoot with Joe. And I think, if looked at in pathway, and provided it is not being used as the only benchmark.
21:01
There's no reason why, a factor that is length of service related. Put it that way, can't be used. You may, you may say in your descriptions that it's the reason we're selecting this, is that it matters, that people have gained experience in the way we operate, and therefore, there's a value to us in having people through combat experience, as long as it's one of many criteria that you're scoring on. There's no reason in principle. White can still have that as part of your matrix.
21:35
OK, and we have one employee who tested unique, Jill, but we no longer need that job pool to select from do. We ignore him or collective redundancy. It would be nice if we could know, Unfortunately, the determination of collective redundancy isn't based on people to particular jobs. It's just based on those those numbers, the threshold of people that a particular establishment. Once you're into collective redundancy, you may then well break the group of people down cohort down into different groups. That may be some way or selected from a pool. That, maybe somewhere, it's an entire pool, and there may be smaller groups, exactly, as you just said.
22:28
That there is only that one person he that avoids the need to consider selection criteria for that person so it makes the consultation slightly simpler in that you don't have to consult on that aspect, but it doesn't mean that it doesn't form part of the directive redundancy itself.
22:50
I'm just conscious of time. So, if we have time for one more question, doctors, there is one more question, yes.
22:59
Do we have to consult fixed term employees, OK.
23:05
So, know, this is the short answer in terms of, well, it's a yes or no. You don't have to count fixed term employees in terms of determining whether you've got over 20 or not if the termination of their employee which is simply the expiry of the fixed term.Â
23:27
So, it's a fixed term is about to expire anyway. You can lawfully terminate at the end of that fixed term and that will not count towards the 20 threshold.
23:39
However, it doesn't stop you still having the individual consultation obligations because the mere expired or fixed contract is not of itself. A reason to avoid an unfair dismissal still has to be a fair process.
23:56
So it doesn't count subtractive redundancy determination, but you still do still have to consult with them in practice.
24:06
So, apologies to those who perhaps have asked questions. We haven't had time to deal with all of those. If anybody does have any questions or as any follow up from some of the things I've said, please do not hesitate to contact me. I'd be very happy to follow up on on those things afterwards.
24:27
So, I think I'm going to wrap up now. So thank you very much for listening in.
24:33
And if, if you have any other queries generally, Just to remind you that we do have a free legal helpline, which you are welcome to contact to obtain legal guidance on matters that affect you and your business.
24:50
The details are on the screen now. Thank you for sharing those styles yet.
24:55
Don't hesitate to get in touch with us through that route, if we can be of any service through that.
25:02
And, finally, don't forget to visit our on demand on our website, where there is access to all of our previous recordings and information and talks, and looks at each of the upcoming talk's that we're running.
25:18
And also, of course, to follow us on our comments on Twitter and LinkedIn.
25:24
That's all for today. Thank you very much.
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