Legal News | 12.07.23
Redundancy: Pools, Selection Criteria and Alternative Vacancies
Article 2 of 6:
An employer considering redundancies will need to adopt a fair selection process. This means that an employer must fairly apply objective selection criteria to a pool of employees. Failure to follow a fair selection process may result in any dismissed employees bringing a claim of unfair dismissal.
What is a pool and how should I select it?
A pool is the group of employees from which individuals are selected for redundancy. Whilst there are no fixed rules on how to select the pool, the employer’s choice should be reasonable.
Matters an employer should consider when selecting a pool include the kind of work that is ceasing or diminishing, the extent to which employees are doing similar work and the extent to which their skills are interchangeable.
What selection criteria should I apply?
Having identified a pool, the employer needs to apply reasonable selection criteria. This means that the criteria should be both objective and capable of independent verification.
Potentially fair selection criteria include: performance and ability; length of service; attendance; and disciplinary records. These criteria should preferably be measured by reference to HR records. Where justifiable weightings may be attached to the criteria to reflect their relative importance. Best Practice is to have more than one manager involved in scoring and there should be evidence of the reasoning applied.
Any criteria selected must not be discriminatory. Nb. The traditional First in First Out method is potentially discriminatory on the grounds of age.
How do I ensure the selection criteria are applied fairly?
The employer must be confident they can justify the application of the criteria. Any obvious inconsistency resulting from bad faith or incompetence is likely to be found unfair.
As part of the individual consultation process (which will be the subject of a future article), the employer should disclose individual employees’ scores to them and give them the opportunity to challenge the criteria. We will explore individual consultation in a subsequent article in the series.
Do I have to offer alternative employment?
Considering alternative employment is a fundamental part of a fair process. An employer is required to make reasonable efforts. This means making potentially redundant employees aware of vacancies during the redundancy process until the employee’s dismissal takes effect.
Any potentially redundant employees on maternity, adoption or shared parental leave have an automatic right to be offered any suitable vacancies.
Applications for those vacancies should be limited to potentially redundant employees and the process must be within the range of conduct that a reasonable employer would have adopted for selection of the successful applicant.
Other articles in this series:
Article 3: Redundancy – Collective Consultation
Article 4: Redundancy – Consultation
Article 5: Redundancy – Scoring
Article 6: Redundancy – Outcome