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How to correctly identify a redundancy pool

How to correctly identify a redundancy pool

Identifying and selecting the correct redundancy pool is one of the most challenging aspects of the redundancy procedure. Failing to consider a pool entirely or identifying the wrong pool may make the dismissal unfair and lead to an employment tribunal claim. Here, we look at how to correctly identify a redundancy pool.

What is a redundancy pool?

A redundancy pool is a group of employees who would be selected as being at risk of redundancy. There are no fixed rules about how the pool should be made up and there is no single right approach. However, employers are required to act reasonably and take care to avoid discrimination. If done correctly, redundancy pools help make sure employees are selected for redundancy in a fair way. Generally, a pool would be a group of employees who carry the same job role.

Factors to be considered

Organisations who have a redundancy procedure should ensure they comply with the procedure, usually, this is located in their staff handbook. If they do not, reference should be made to the ACAS guidance.

When determining a selection pool an organisation may make reference to several factors, including:

-Duties and responsibilities: Employees that undertake the same or similar roles may be included in the pool. The pool need not be limited to employees who undertake identical roles. For example, if an organisation is looking to make redundancies within its secretarial team, it may be unreasonable for it to exclude members of the administrative team who do similar/the same work as the secretarial team.

-Organisation structure: If employers are considering making redundancies within a particular team, they should look at the business as a whole and consider whether there are employees who undertake similar/the same work even if they work in a different part of the business or different shift unless there is a good reason to excuse them.

-Location: employers may consider employees who work at a different location but carry out the same or similar roles as the individuals who are at risk of redundancy when they are considering their redundancy pool.

-Interchangeable skills: If an employee has previously worked in other roles at the organisation, it is likely that their skills are interchangeable with other employees and so a wider pool may be required.

-Associated Employers: The Employment Rights Act 1996 states that the business of the employer together with the business or businesses of associated employers shall be treated as one for the purposes of determining whether or not a redundancy situation exists. Therefore, it may be appropriate to include employees working in associated companies who carry out the same or similar roles.

If the organisation recognises a union, it is expected that the choice of pool will be discussed with the union.

The size of the redundancy pool

Usually, employers like to keep the redundancy pool narrow, the wider the pool the more onerous the process shall be on the employer as there shall be more individuals to consult with. However, employees tend to prefer wider pools as this reduces their risk of being made redundant.

Employers who want to formulate a narrow pool which contains solely of those provisionally selective for redundancy should bear in mind the litigation risk associated with this as they are effectively by passing the pool stage.

How we can assist

Our team of expert employment solicitors can assist you in ensuring that you select the correct redundancy pool and therefore reducing the risk of an unfair dismissal employment tribunal claim. To speak to a member of our team, please call 02079036888 or email us at contact@davenportsolicitors.com.

The key things an Employer should consider before deciding to settle or defend an Employment Tribunal claim

Recently, the BBC spent £500,000 defending an unfair dismissal claim against its former chief technology officer, after being offered to settle the case for £50,000.  The sum of almost £500,00 did not include damages paid to the claimant, which were reported to be nearly £80,000. Here, we look at the key things an Employer should consider before deciding to settle or defend an Employment Tribunal claim.

When facing a tribunal claim, an employer needs to understand the different influences on the situation they are facing. It is important to make sure that you make the right decision in each situation as there are no guarantees and there are costs involved, irrespective of the outcome.

There are counter considerations if you settle cases on a cost-saving basis, like employees who settle because it will save them money, but there also needs to be a balancing act between the benefits of defending the case, and the benefits of resolving the claim quickly.

Key considerations for employers before deciding to settle or defend an Employment Tribunal claim

Your Chances of Success
If you have all the documentation and information available about the claim, you should be able to assess the chances of fighting it successfully. If your chances are below 50%, it may be a good idea to consider settling.

Costs and Remedy
How much will it cost you to defend the claim and will defending the claim cost you more than just settling it? As well as your court costs, depending on the type of case, if you lose, you could be ordered to pay the claimant compensation and witness expenses they’ve paid.

Workplace Culture
The settlement could have an indirect impact on your business if it affects employee relations or causes an internal expectation. Employees could see a settlement as rewarding an ex-employee.  

Indirect Message
If the claim is against the management team, a settlement of a claim may send a message that managers are not supported.

Publicity
Whether the publicity associated with going to tribunal could affect your business. However, depending on the claim, you may want to defend the claim to avoid setting a precedent.

Insurance
It is worth taking out Employer’s Dispute Insurance, which is not the same as Employers Liability Insurance! Most insurance covers will cover your legal costs associated with defending a claim. If you already have Employer’s Dispute Insurance in place, then speak to your insurers. We are pleased to be working with an external insurance company that provides a very comprehensive cover. For more details please contact us here.

Every case is different but to defend a claim as an employer, take all the factors above into consideration and keep the chances of success and settlement under review throughout the cycle of the claim.

We hope that you have found this post on The key things an Employer should consider before deciding to settle or defend an employment tribunal claim useful. If you’re an employer looking for advice when it comes to settlement agreements or an employment tribunal claim, please contact one of our employment lawyers today.

Employment law and the COVID-19 vaccine

Employment law and the covid-19 vaccine

Ikea and Wessex Water are the latest large companies to announce a pay cut in sick pay for unvaccinated workers. Employers across all sectors have faced vast staff shortages as a result of the Omicron variant. This has placed great strain on productivity and profitability and employers are looking for solutions to mitigate the damage. In this post, we look at Employment law and the COVID-19 vaccine. 

Employment law and the COVID-19 vaccine

In normal times of a downturn in the economy, cost-saving exercises tend to rely on redundancies. The challenges of the pandemic have proved more nuanced, however, as companies seek ways to now plug the short-term shortfall arising from mass absences. 

Cutting sick pay for the unvaccinated appears however to be an unprecedented move but one that is becoming increasingly common as companies try to address the pressure. 

Singling out unvaccinated workers, however, is not without risk and may not always be a proportionate or the most reasonable way of realising the bottom line.  Where companies operate a blanket policy like this then such a move may expose the Company to cases of discrimination on grounds of protected characteristics such as pregnancy or philosophical belief. 

The right of choice

The right to a private life remains a principle protected by the Human Rights Act and as long as the Covid vaccine remains unmandated people will have the right of choice. Infringing on that choice by penalising unvaccinated workers is therefore risky when that freedom of choice is protected in law. 

Employers should therefore carefully consider the reasons why employees are not vaccinated and whether those reasons fall into the categories of protected characteristics under the equality legislation. Medical exemptions are likely to be covered by the protections under disability discrimination and the very essence of freedom of choice makes a compelling argument in reliance on the protected characteristic of philosophical belief. 

It’s important to note that the sick pay cut announced by Ikea is in relation to staff who are unvaccinated and have to self-isolate because of being identified as a close contact.

Unvaccinated staff who are off work because of Covid will still continue to receive full sick pay. The risks inherent in balancing these issues have clearly been acknowledged by Ikea as evidenced by this distinction and their statement that each matter will be judged on a “case by case basis”.  Across the pond, however, far bolder moves are being made with “no jab, no job” policies now being routinely rolled out amongst major multinational corporations. 

The legality of such policies in the UK in regard to dismissals and to cuts in sick pay will ultimately remain matters to be adjudicated by the courts when inevitably challenged by employees. 

For now, employers need to be aware of the risks of discrimination claims that may arise when implementing policies relating to unvaccinated workers. 

We hope that you have found this post on Employment law and the COVID-19 vaccine useful. For help with identifying, managing, and mitigating those risks please speak to a member of our employment law team, please call 02079036888 or email contact@davenportsolicitors.com

Employment Dispute Resolution: How to Resolve Internal Disputes Effectively

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Employment disputes at work arise from time to time.  When an employment dispute first materialises if it is handled quickly, pragmatically and appropriately, often a solution can be found which meets the satisfaction and needs of both the employer and employee.

An employment dispute could arise for several reasons. Employees may have concerns over pay and working conditions, proposals to change duties or the work location, maternity rights, concerns with redundancy, threats of termination of employment or disciplinary action, flexible working requests, changes due to health issues and following bullying, harassment and discrimination. When an employer/employee dispute arises, it is in the best interest of the company and the employee to resolve the dispute as quickly as possible, especially if both parties wish to continue their relationship in the future.

Common Examples of Employer/Employee Disputes

Issues With a Performance Review

If the employee truly thought they were going to receive a raise, promotion, or another accolade for their work; a negative review could lead to a dispute with their direct supervisor.

Conflicts With a Supervisor

Aside from disagreeing about a performance review, other types of conflicts can arise between a supervisor and a subordinate. An employee might feel as if they are not being guided properly by their supervisor or that they are being bullied by their supervisor.

Issues With Discrimination

A personal prejudice by an employee or discriminatory actions by an employer can lead to an employer/employee dispute that can cost a company thousands upon thousands of dollars.

Conflicts With Customers

If your business operates in the sales industry, your employees likely face conflicts with customers on a daily basis. Some of these conflicts can escalate if the customer feels as though they were defrauded by your employee.

Issues With Work Styles

Each employee you hire will have a different work style, which means there’s bound to be conflicts between employees or between employees and supervisors.

Conflicts With Creativity

It can be hard for employees to understand that their ideas become the property of the employer, even if it is expressly stated in their employment contract at the time of hire.

Issues With Co-workers

Not all of your employees will be able to get along with each other because of differing personalities. When co-workers begin to feud, it can potentially lead to a hostile work environment and a legal issue for your company.

Employment Dispute Regulations

The employment dispute process is governed by three main regulations; the Resolution Act 1998, the Employment Act 2002 and the Dispute Resolution Regulations 2004.

Resolution Act 1998

The Employment Rights (Dispute Resolution) Act 1998 (c 8) is a United Kingdom Act of Parliament which regulates UK labour law. The 1998 Act empowered the Advisory, Conciliation and Arbitration Service (ACAS) to create arbitration hearings as an alternative dispute resolution mechanism to the employment tribunals.

Employment Act 2002

The Employment Act 2002 was introduced to encourage more individual employment disputes to be settled within the workplace, without recourse to an employment tribunal. It introduces statutory minimum internal disciplinary and grievance procedures for all organisations that employ staff, and measures to promote their use.

Dispute Resolution Regulations 2004

 The Dispute Resolution Regulations 2004 require employers to develop and make available to employees minimum statutory procedures for resolving grievances and dealing with allegations of misconduct and poor performance in the workplace. The Regulations can be viewed here.

How to Professionally Resolve Employment Disputes

There are a number of options available to employers and employees for resolving employment disputes and avoiding an employment tribunal, including setting up a settlement agreement, using professional mediators or the use of arbitration services for unfair dismissal and flexible working claims.

Should a tribunal situation occur, employers have a duty to assist the tribunal to achieve its overriding objective of dealing with the case justly and seeking to achieve a resolution of the dispute. They must file a response form within 28 days if they wish to contest employment tribunal proceedings and comply with any order from the tribunal to provide “further or better particulars” or to disclose documents.

Furthermore, employees must adhere to the above and understand that if they enter into a conciliation agreement (arrived at through Acas) or a settlement agreement to settle a dispute with the employer, they will no longer have the right to pursue their complaint through the tribunal system.

Find out more about Employment Disputes and Employment Tribunal Claims here.

Employment Resolution Dispute Advisors

A business may face a number of different types of claims for various reasons. No matter what claim you face, informing and instructing us as your employment law solicitor as early as possible will ensure that you are represented in the best possible way.

If you would like to learn more about how Davenport Solicitors can support you if you need to resolve an employment dispute, contact us, email contact@davenportsolicitors.com or give our expert employment tribunal claim lawyers a call on 02079 036888.

 

Understanding the Employment Tribunal Process – What Employers Should Expect

a guide on the employment tribunal process

Employment tribunals are specialist employment ‘courts’. A tribunal comprises up to three people. The employment judge will be legally qualified, and there may be two lay members, one of whom has been chosen as an employee representative and the other as an employer representative.

The purpose of the employment tribunal is for it to make decisions about employment disputes.  Pursuant to employment law, employees have various employment rights which are protected.  As an employer, if you breach these rights, an employee could take you to an employment tribunal to seek remedy or compensation.  You can be taken to an employment tribunal for a number of issues such as discrimination at work, unfair dismissal or an issue relating to wages or redundancy payments.

However please note that there are many other types of employment claims which can be brought by an employee. The employee or job applicant, who can take you to an employment tribunal, will not have to pay a fee. This was confirmed in July 2017, when the Supreme Court deemed the fees unlawful. A Trade Union may also make a claim against you. In this post, we look at a guide to the employment tribunal process for employers.

Responding to an Employment Law Tribunal Claim

When an employer receives an employment tribunal claim, it needs to act quickly and carefully to put itself in the best position to defend the claim, or to reach a fair settlement with the claimant, avoiding unnecessary costs. The following steps need to be taken:

1. Deal with the claim promptly

A tribunal claim needs to be dealt with promptly. There should be procedures in place within an organisation to make sure that, when an ET1 (the tribunal claim form) is received, it is immediately brought to the attention of the relevant people. The employer’s response to the claim must arrive at the tribunal office, on the prescribed form (the ET3), within 28 days of the date on which it was sent out.

2. Assess the merits of the claim

The employer should carry out a careful assessment of the strengths and weaknesses of the claimant’s case and of its own defence, and decide whether or not it is worth fighting the claim.

Even if the employer thinks that it is in the right, settlement may be the more economic option, taking into account the cost and time involved in defending a claim. Click on the link for more information on employment tribunal claims.

3. Focus on the issues that are relevant

The employer should focus on the claimant’s specific allegations, and on the legal issues involved. It should respond to the claimant’s case in detail as it may not be possible to introduce further information at a later stage.

4. Stick to the deadlines

The important thing is to remember that the form must be received at the tribunal office within the deadline, not just sent, so employers should try not to leave it until the last minute. An employer can apply for an extension to the 28-day deadline, but this is granted only at the judge’s discretion.

Solutions to avoid Employment Tribunal

The good news for employers is that employment tribunals can be avoided.  It’s important for employers to regularly review their policies and procedures to ensure that they are complying with both the law and best practice and are not tripped up by changes in law. It is not unusual for employers to follow out of date procedures or policies in good faith, only to subsequently find that the process they have followed potentially gives rise to a claim because it was based on out-dated law. Ultimately, employers have a duty to fully understand their responsibilities.

Providing employees with written terms and conditions of employment, i.e a contract of employment is another way to avoid an employment tribunal.  Certainty over employment terms is good for both employers and employees and prevents conflict. Ambiguity in drafting and a failure to keep contracts up to date with both internal practice and legislation are common causes of dispute. Find out more about contracts of employment here.

Additionally, grievances, should they arise, should be dealt with and documented. However small a grievance is deemed to be – it should not be ignored or dismissed. A grievance, raised either formally or informally, is an early indication of a problem. Dealing with these problems effectively could prevent a dispute from developing. For more information on potential employment tribunal cases, click here.

The Employment Tribunal Process for Employers

Employment tribunal claims take a long time.

According to HM Courts and Tribunals Service, the average time between starting a claim and receiving a decision is 27 weeks. Depending on the factors involved, it could be more than a year. Meanwhile, a settlement can often be concluded within only a couple of days.

There is a three-step process for handling a claim made against you at the tribunal:

  1. Early Conciliation
  2. The Claimant submits the ET1 form
  3. Receipt of case management order or date set for a Preliminary Hearing – Case Management

The Employment Tribunal’s Rules of Procedure allow for several types of hearing:

  • A Case Management Discussion – this is used to clarify issues and determine the Directions for a case
  • A Pre-Hearing Review – to determine the entitlement of a party to bring or defend proceedings (or an entitlement to Interim Relief), a form of preliminary finding in certain types of claim involving Trade Union activities or making a protected disclosure (whistleblowing), which may order a former employer to continue to pay a dismissed employee until a full hearing
  • A Full Hearing – which may determine liability and/or remedy
  • A Review Hearing – to reconsider a judgement
  • Disclosure
  • Witness statements

Legal Representation During Tribunal

While in theory, it is ok for individual parties to represent themselves in an employment tribunal without suffering a disadvantage, we would always recommend seeking the advice of an experienced lawyer. The tribunal judge is supposed to take reasonable steps to address the imbalance between the two sides. In practice, there are very definite limits to the assistance on offer from the tribunal judge, and in practice, litigants in person are often left significantly worse off than the other represented parties.

If you would like to learn more about how Davenport Solicitors can support you if you have received a letter of a tribunal claim, contact us, email contact@davenportsolicitors.com or give our expert employment tribunal claim lawyers a call on 02079 036888.

Employee Rights After 2 Years – What Businesses Need to Know

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Under Employment Law, employees must have worked continuously for two years before they acquire full employment rights, also known as the “qualifying period” or the “two-year rule”.

Unless there are outstanding circumstances, temporary workers on a fixed term are entitled to the same working conditions as their permanent employee counterparts after 12 weeks in the job. This means that they should receive the same pay, holidays, rest periods, and working hours as everyone else employed by the company, however, their rights are not the same.

According to the Fixed-term Employment (Prevention of Less Favourable Treatment) Regulations, any employee on a fixed-term contract for four or more years is typically defined as a permanent employee by law if their contract is renewed or they are given a new fixed-term contract to fulfil by the same company.

There are exceptions to this provision, such as if the company needs to lengthen the extent of the original contract beyond four years under a collective or workplace agreement.

Fixed-term employees are subject to the same tax arrangements as permanent employees and in instances where the employers employ the worker directly, it is up to the employer to ensure that all the relevant paperwork is in order.

What is temporary employment?

Temporary employment, whereby workers are engaged only for a specific period of time, includes fixed-term, project- or task-based contracts, as well as seasonal or casual work, including day labour.

Find out more about temporary employment law here.

There are different types of temporary workers. Those on fixed-term contracts, those on zero-hour contracts, freelancers, and those employed on a part-time basis:

  • Fixed-term – the duration of a temp’s employment when working on a fixed-term contract will be agreed from the outset and have a firm start and finish date. Fixed-term employees can’t be treated less favourably than their permanent counterparts and employers have to ensure they have the same benefits as permanent workers.
  • Freelance – much like contractors, a freelancer tends to be self-employed which makes them responsible for their own tax and NI contributions. They are often employed with a very specific skillset and are brought in for an interim period. Freelancers can choose when to start and end their employment, and you are at risk of losing them should they receive a better offer elsewhere.
  • Zero-hours – a zero-hours contract is an agreement whereby the employer does not guarantee any working hours. The idea is that when the need arises there is the resource available at short notice and work is duly assigned. Anyone accepting a zero-hours contract must be paid at least the national minimum wage and is entitled to the basic statutory rights of employment.

Changes to Employment Law in 2012

As mentioned in the introduction, in April 2012, there were several changes made to Employment Law. One of the most significant changes was the increase in the qualifying period for unfair dismissal claims. Employees whose employment began on or after 6 April 2012 have to complete two years’ service with the employer before they can claim unfair dismissal. This is commonly known as the two-year rule.

It is worth noting that it is not always necessary for an employee to have accrued the required qualifying service to claim unfair dismissal. Some dismissals will be automatically unfair, regardless of how long the employee has been with the employer. There are also other qualifying requirements for the right to claim unfair dismissal, in addition to the requirement to have worked for the employer for the relevant period, including that the individual must be an employee (as opposed to a worker or self-employed). Some classes of employees are excluded from the right to claim unfair dismissal.

Claims for most types of automatically unfair dismissal can be made without two years’ service including where a dismissal is:

  • in connection with an application for flexible working;
  • for a health and safety reason;
  • related to the National Minimum Wage;
  • for a reason connected with rights under the Working Time Regulations; and/or
  • in connection with exercising the right to be accompanied to a disciplinary or grievance hearing.
  • Dismissals in connection with spent convictions and TUPE can also be automatically unfair but require the two years’ qualifying service.

How long before a Temporary Employee becomes Permanent?

An employee can be kept on successive fixed-term contracts for a limit of four years. If a contract is renewed after that the temporary employee becomes a permanent employee unless the employer can show a good reason why they should stay on a fixed-term contract. It should be noted, this only applies if the temporary employee is employed directly by the employer and not via an agency.

Workplace or collective agreements can vary the limit on the length or number of successive contracts used by an employer. They can also limit the use of successive contracts and set a list of reasons to justify renewals of fixed-term contracts.

Once a temporary employee becomes a permanent employee, under employment law, their contract changes to a permanent employment contract, and the terms of their employment should be set out in the employment contract.

Can a Temporary Employee claim unfair dismissal under 2 years of service?

Legally, employees need two continuous services to be able to claim unfair dismissal. This means that employers have a degree of flexibility in managing and dismissing an employee who has less than two years of service. However, as mentioned previously, employees may still have other claims such as: wrongful dismissal, breach of contract, and discrimination within the first two years of employment.

Whilst an employee with less than two years’ service cannot claim ordinary unfair dismissal, other types of claims can still be brought regardless of their length of service. Employers should exercise caution before contemplating the dismissal of any employee, giving careful consideration to the reasons and circumstances of the dismissal.

There are certain types of dismissals that are automatically unfair regardless of whether the employee has two years’ continuous service. For example, if the employee can show in the Tribunal that they have been dismissed for one of the reasons below, they could argue that their dismissal is automatically unfair:

  • taking leave for family reasons – i.e. pregnancy, childbirth, statutory maternity, paternity, adoption, parental leave, shared parental leave of time off for dependants;
  • raising health and safety concerns for fellow employees or themselves;
  • making a protected disclosure (whistleblowing);
  • submitting a flexible working application;
  •  asserting a statutory right; or
  • raising breaches of the national minimum wage.

Employers must exercise caution when contemplating a dismissal. No qualifying length of service is required for a dismissal which is deemed automatically unfair. The full list is set out in the Employment Rights Act 1996.

Irrespective of their length of service, an employee may also bring a discrimination claim if their dismissal was for a discriminatory reason. Therefore, Employers should consider carefully whether the reason for dismissal is linked in any way to a protected characteristic (i.e. age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, and sexual orientation), particularly as there is no cap on the compensation awarded in discrimination claims. Whatever the circumstances, it is vital that employers follow a fair process.

Renewing & Ending Fixed-Term Contracts

There is no maximum duration for an employee’s first fixed-term contract. However, if the employment is renewed at the end of the initial fixed-term contract, things are considerably different, and, as stated previously, employees have the right to become a permanent employee after four consecutive years of fixed term contracts with a business.

If a fixed-term contract is coming to an end, but the business would like to retain the employee for a little longer, it is possible to offer an extension. Though this can be discussed face-to-face, it’s usually committed to paper for formal record too. Typically, this takes the form of a letter, in which the employer will detail how long the contract will be extended for, an end date, and the reason for the contract extension.

As a result of the two-year rule, after a two-year period, fixed term employees are granted the same redundancy rights as a permanent employee. If a fixed-term employee has accrued over two years of continuous service at a business and the contract comes to an end, this counts as a dismissal. In such a case, the employer has to demonstrate that there is a just reason for not renewing the contract. They must also provide the employee with a letter detailing the reasons for not renewing the contract and ensure that the worker is not unfairly dismissed.

If an employer wants to terminate a fixed-term contract before the agreed-upon end date, the process is largely determined by the specific terms of the contract. If the original contract dictates that the employer can terminate the employment before the designated end date, then they are not in breach of contract. However, if there is no mention of early termination in the original contract, the employer may well be in breach of contract.

Next Steps

We hope that you have found this article on Temployee Rights After 2 Years – What Businesses Need to Know useful. If you have any further questions or would like to discuss any additional employment law-related issues, please contact a member of our team.

Advice and Guidance for TUPE, Restructuring, and Redundancy

Understanding TUPE Law, Restructuring a Business and handling Redundancies

There are times during any business’s lifetime where the organisation may require restructure or may need to reduce staffing levels. Any restructuring and redundancy process is tough for both employers and employees alike. After all, both restructuring and redundancy involve change and change makes people feel unsettled.

As per employment law, employers are legally required to consult extensively when it comes to both restructuring and redundancy. Not just on the need to reduce workforce roles or create new ones to better align with the needs of the business, but also pools for selection, selection criteria, and application of that criterion and suitable alternative employment. Get the process wrong, and not only will the organisation have a legal battle on their hands, but their reputation will also be severely damaged. In this post, we look at advice and guidance for TUPE, restructuring and redundancy.

What is TUPE, redundancy, and restructuring?

One of the most common reasons for an organisational restructure is a major change in the way a business will operate. But what do the terms surrounding business reorganisation mean?

TUPE refers to the Transfer of Undertaking (Protection of Employment) Regulations 2006. TUPE applies when an organisation or a service transfers to a new employer. The purpose of TUPE is to protect employees if the business in which they are employed changes hands. For example, when a maintained school converts to an academy, or if one business merges with another to become a new business. Furthermore, TUPE applies where an organisation outsources or makes a “service provision change” involving either initial outsourcing of a service, a subsequent transfer and bringing the service back in-house.

Restructuring is a process. The aim is to get the right roles set up in the best way so that a business can deliver its products or services more efficiently and effectively. It can involve creating new roles, merging existing roles, disestablishing roles that aren’t needed, or a combination of these things.

Every restructure needs to be driven by a genuine commercial reason – e.g. a change in market demands, financial constraints, brand realignment, merging with another company – and this reason must be clearly communicated during the restructuring process.

Redundancy is an outcome, usually of the restructuring process. In the course of a restructure, roles that are identified as surplus to the company’s commercial needs become redundant (or are disestablished). So, a restructure can lead to redundancy, but redundancy cannot lead to a restructure.

For assistance and advice with restructuring and redundancy, call us on 0207 903 6889 or email contact@davenportsolicitors.com.

What are the stages of Redundancy?

There is a five-set redundancy process in place to ensure that companies have made every effort to treat employees fairly.

Step 1: Explore whether or not you can avoid redundancies.

Businesses have a legal duty of care to try to avoid redundancies and they must prove that they have made every effort to keep their employees in employment.

Step 2: Identify who will be made redundant.

If redundancies cannot be avoided, a business must identify which of its employees will be made redundant. Unfair selection criteria, such as pregnancy or age must not come into play. Fair selection criteria, including skills and natural abilities, standard of work, attendance, and length of service must be applied.

Step 3: Redundancy Consultations.

Once you have selected which employees face redundancy, employment law states that you must hold redundancy consultations, which give employees the opportunity to contest the redundancy within an employment tribunal.

Step 4: Giving staff notice.

Once the redundancy consultation process is complete, you must give the employee notice and agree on a leaving date. The notice period will depend upon the employee’s length of services with the company. If an employee has been with the company for one week – two years, you must give them a minimum of one week’s notice; for two – 12 years employment, it is a week’s notice for every year served, and for over 12 years of service it is a minimum of 12 weeks notice.

Step 5: Redundancy Pay.

All employees are entitled to redundancy pay, often referred to as ‘Statutory Redundancy Payment’. Redundancy pay is calculated based upon an employee’s age and the length of the employee’s employment, counting back from the dismissal date. Length of service is capped at 20 years. Employees will get 1.5 weeks’ pay for each full year of employment after their 41st birthday; one weeks’ pay for each full year of employment after their 22nd birthday and half a week’s income for each full year of work up to their 22nd birthday.

Read more about the legal requirements of the redundancy and restructuring process >>

TUPE Employer Rights

If you are an employer involved in a TUPE situation you will fall into one of two categories:

  • a) You are the transferor, the old employer
  • b) You are the transferee, the incoming new employer.

Employment law dictates that in any TUPE situation, that the affected employees transfer from transferor to transferee with their length of service, status, and contractual terms and conditions along with any liabilities associated to the employees. This means that there are obligations placed upon the employer, whether they be the transferor or the transferee.

Legally, they must both consultant the employees that will be affected by the transfer, or their representatives on the employee’s behalf. Both parties also have a duty to share information with one another. The transferor must supply the transferee with any relevant information about the employees, and the transferee must provide the transferor with the information they require to inform and consult their transferor.

In terms of employee representation, if there is no trade union in place, the employer is legally required to offer the employees the right to elect representatives and facilitate such an election. Details of employee representation should be detailed in a staff handbook and employment contracts.

TUPE Employee Rights

In TUPE, ‘transferring’ means that an employee will automatically transfer from their current employer to a new employer. In a TUPE situation, employees have the right to refuse the transfer, but this could leave them vulnerable depending upon the situation and put them at risk of losing their legal rights. Such refusal will mean they have no rights to claim unfair dismissal or a redundancy payment unless they object for particular reasons.

Under TUPE, employees are protected from any change to their contract of employment that occurs directly because of the transfer. If the transferee breaches this, the contract changes will be void. Changes to the contract of employment will only be valid if they are required for the running of the business. For example, in a TUPE situation, it is not uncommon for an employee’s place of work to change. If this location change is significant, an employee has the right to protest. This may bring a claim for constructive dismissal.

A dismissal because of a TUPE transfer is automatically unfair unless it can be justified as an economic, technical, or organisational reason that requires changes in the workforce. Employees dismissed before, during, or after the transfer can claim unfair dismissal against the new employer, providing that they have a minimum of two years’ continuous service.

Read more about employment disputes >>

How long does a company restructure take?

As they are complicated in nature, company restructures are lengthy processes. Depending on how prepared a business in advance of its restructure, the process can take up to five years to complete. But what is it about a company restructure that actually takes so long?

The most complicated part of the process lies ahead of the restructure itself, the preliminary research stage. This is the point at which a business must look at why they need to restructure and what they can do to resolve this problem. All company processes must be reviewed, and all potential outcomes must also be considered in detail. This is a process that takes a long amount of time.

Once a business has begun to identify its strengths, weaknesses, opportunities and threats of difference restructure scenarios, it can begin to enter the decision making phase. This is where a business develops its restructure plan for implementation.

The implementation phase is where the restructure plan is implemented and a business has to deal with any problems that may arise as a result of this. The stage of the process is likely to be subject to a timetable, and includes having to move staff to their new roles and functions within the organisation, which can often be problematic.

The last part of the process is the review phase. This is where the business must review the impact of the implementation phase. It’s highly likely there will be issues will every business restructure – but this is the point to resolve these issues or employee attitudes and enthusiasm towards the restructure are likely to decline.

Our employment law solicitors can help with restructuring and redundancy. Contact us today. Call us on 0207 903 6889 or email contact@davenportsolicitors.com.

Can an employer change redundancy terms?

Notice of redundancy is legally binding and cannot be withdrawn once it has been served. However, as part of the Employee Rights Act, an employee who is dismissed by reason of redundancy loses the right to a statutory redundancy payment if they unreasonably refuse an offer of suitable alternative employment. Furthermore, if once notice of redundancy has been issued, the employer offers the employee their job back on the same terms and conditions as per their contract of employment, but the employee turns it down, the employer has the right to argue that no statutory redundancy payment is due because the employee has ‘unreasonably refused an offer of suitable alternative employment.’

What is a fair redundancy package?

As we discussed earlier in this article, all employees are entitled to Statutory Redundancy Pay, which is the legal limit an employer must pay to all employees who are made redundant. Statutory redundancy pay is calculated on the basis of your age, length of service and weekly pay. A week’s pay is currently capped at £538 but this amount is reviewed annually and usually increases each April. Length of service is capped at 20 years. Employees will get 1.5 weeks’ pay for each full year of employment after their 41st birthday; one weeks’ pay for each full year of employment after their 22nd birthday and half a week’s income for each full year of work up to their 22nd birthday.

Next Steps

We hope that you have found this article on TUPE, Restructuring, and Redundancy useful. If you have any further questions or would like to discuss any additional employment law-related issues please contact a member of our team.  You can get in touch with us directly by calling 0207 903 6889 or emailing contact@davenportsolicitors.com.

Woman awarded £400,000 by DWP following claims of race and age discrimination

Empty black rolling chairs at cubicles

The Department for Work and Pensions (DWP) must pay out nearly £400,000 after a Cardiff woman won her claim for race and age discrimination.

Anne Giwa-Amu, who is of Nigerian and Welsh descent, started at the Caerphilly branch of the DWP as an administration officer. She was the only non-white recruit and only trainee over the age of 50.

The court heard how colleagues of hers at the DWP used racist language, laughed at her, told other colleagues that he had “touched her bum”. Her colleagues at the DWP even went as far as to accuse her of stealing ice cream and would spray body spray on themselves whilst next to her.

Anne went on sick leave in March 2017 and was unlawfully dismissed in October that year for being unable to return to work. Her final pay cheque had been withheld and she had been living off £55 per week, the court heard.

Judge Howden-Evans said DWP staff had deliberately created a “hostile environment” for Giwa-Amu and ordered the department to pay out more than £386,000 in compensation, including £42,800 for injury to feelings.

The DWP said that it took the judgment “very seriously” and that racism was unacceptable. It has been ordered to contact the Equality and Human Rights Commission for diversity awareness training and its permanent secretary, Peter Schofield, must directly review her case.

Ethical veganism recognised as a philosophical belief

Vegan protestor holding a sign

A tribunal has, for the first time, ruled that ethical veganism is a “philosophical belief” and so is a protected characteristic in law.

Under the Equality Act 2010, there are nine protected characteristics. These include characteristics such as age, sexual orientation, race and, most notable to this recent ruling, religion or belief.

The landmark case was brought by Jordi Casamitjana, claiming that he was sacked by the League Against Cruel Sports because of his ethical veganism. Mr Casamitjana claims that after alerting his boss of the fact that the charity invested pension funds in firms involved in animal testing they did nothing. He then informed colleagues, which he claims led to his sacking.

The judge ruled that ethical vegans should be entitled to similar legal protections to those that hold religious beliefs etc.

The League Against Cruel Sports says it is “factually wrong” to link Mr Casamitjana’s dismissal to his ethical veganism.

It is important to note that a ruling from an employment tribunal does not necessarily have to be followed, nor automatically lead to a change in the law. It does, however, provide guidance to employers as to the likely outcome of similar cases in the future and act as a warning.

How age discrimination cost an NHS Trust £200,000

Person in white gloves writing on paper

An 88-year-old medical secretary has become the oldest person to ever win an age discrimination case, following her dismissal from the Royal Berkshire NHS Trust.

Eileen Jolly was fired from her role at the Royal Berkshire NHS Trust in January 2017, aged 86. Her colleagues told bosses that they were concerned by her age and that she had become frail. She had been accused of failing to add details of a cancer patient awaiting non-urgent breast reconstruction surgery into a newly-introduced electronic database.

Jolly claimed that she had not been adequately trained to use the new record system. Saying during the tribunal: “I felt as though [the manager] had assumed that at my age and because of my health I was a liability and incapable of change, and had to go.”

Ruling on the hearing, judge Andrew Gumbiti-Zimuto said: “There was evidence of the Claimant’s training having been inadequate, incomplete and ‘on the job’ training was ad hoc and not directed.

“There is a suspicion of the Claimant being a scapegoat, the Claimant was not offered training where it might be considered appropriate.”

The breast surgeon she worked with also came to her defence claiming she was “reliable and meticulous” and that she had been used as a scapegoat for management failings.

The ruling

The Employment Tribunal ruled that her case was “tainted by discrimination” and Jolly was offered a settlement worth £200,000 by the Trust.