A critical piece to managing redundancy in any workplace, is to remember the process is about roles and not people. However, over the course of making roles redundant, the people impacted may raise redundancy complaints or have objections to how the process has been handled. Any downsizing, or business re-structure, involving redundancies must have a fair process and follow best practice.
Redundancy process
Following all efforts towards redeployment of an employee, if redundancy is the outcome and the role can no longer exist, there are still some steps an employer must take.
The employer must either employ the worker for the remainder of the notice period, or pay the amount as though this had occurred. Following this, final wages and holiday pay, as well as any redundancy compensation which may be due as part the terms of the employee’s employment agreement, should be paid to the employee.
After the final payment has been made, the only action required by employers is what has been committed to in agreements or contracts. Examples can include any transition programmes, or assistance in searching for a job. These are not required unless agreed between the employee and employer, either in the employment agreement or as part of the redundancy process.
For information on the redundancy process, read the process and the role of employers here.
What happens when a redundancy goes wrong?
Employers following a fair process, with open communication at all times, should have no concerns as to how lawful and compliant their process has been However, if an employee should feel they have been treated poorly, there are a number of ways they can raise a complaint around the redundancy process.
Who hears redundancy complaints?
If an employee feels they have been hard-done by following a redundancy process, they may complain to a number of bodies, but it will ultimately end up in either the Employment Relations Authority or the Employment Court, although a decision does have to be made in the Employment Relations Authority before it heads to the Court.
The Employment Relations Authority
With an employment dispute, an employee and employer must first try to resolve the matter between themselves. If this is unsuccessful, the dispute may proceed to mediation.
Mediation is a free, but voluntary, service offered by the Ministry of Business, Innovation & Employment which allows employment disputes to be heard and negotiated in a neutral environment, with the assistance of a Mediator who is trained in aiding parties to resolve issues such as this.
If the employee and employer still cannot come to an agreement regarding the matter, the parties have the option of proceeding to the Employment Relations Authority (ERA)., where an ERA member will review the matter and make a determination based on evidence provided by both parties. If either the employee or employer disagrees with the ERA member’s decision, they may challenge this through the Employment Court.
For more information on this process and what to expect, click here to read our guide.
Redundancy and the Employment Court
For a redundancy challenge to escalate to the Employment Court there must be a series of challenges with the employee still feels the redundancy process was not fair, or not conducted in good faith. The costs associated with the Employment Court are much higher than other remedies, and the time it can take to resolve a court case will often be much longer than other remedies. Nonetheless, employers may find themselves having to defend a redundancy process, which is where documenting the process from the beginning and acting in good faith will be hugely advantageous.
Redundancy processes are hugely complex and can be challenging for employers, but the process becomes even more damaging if the employee makes redundancy complaints at any stage along the way. For advice, employers should contact Employsure on 0800 521 590.
