The COVID-19 pandemic has transformed how we work, where we work, and for some, it might spell the end of their work.
The Coronavirus Job Retention Scheme (CRJS) ends on 31 October 2020.
When it was first implemented, it was universally hoped that the scheme could help protect the jobs of those employees unable to work from home and adversely affected by the pandemic containment measures.
At the time, no-one had any idea how long the pandemic would last or what the future held.
The CJRS is being replaced from 1 November 2020 by the Job Support Scheme (JSS) – which will run for six months.
The Job Support Scheme broadly means employees must work at least 33% of their usual hours; the cost of those working hours must be met in full by the employer.
The employee would then be paid two-thirds of any hours when they are laid off, with the cost of the non-working hours being met in equal shares between the employer and HMRC.
The JSS does mean increased employee costs for the employer, and many employers are rightly asking “can I afford to keep this role?”
Increased staffing costs – despite the new JSS assistance scheme – coupled with the recent ‘second wave-like’ spike, the potential for more/necessarily harsher containment measures and the ensuing negative impact on turnover/profitability all point towards one unfortunate option for employers: redundancy.
Redundancy, as described by the UK Government, is “a form of dismissal from a job. It happens when employers need to reduce their workforce.”
With the COVID-19 ‘R’ Number changing weekly and localised restrictions and lockdowns being announced on an almost daily basis, employers are concerned, and tough decisions may have to be made to safeguard the future of businesses.
All the data points towards a swathe of redundancies occurring in the latter half of 2020 and the first quarter of 2021.
Director of Business Law at Granite Legal Services, Gervase McGenity, said that if an employer is contemplating making redundancies, they need to understand how to operate and document a redundancy process properly.
Redundancy is one of the potentially ‘fair’ reasons for terminating employment.
However, the decision and process have to be operated in a substantively and procedurally objectively fair way.
“It’s also important to remember: people aren’t made redundant; instead, it’s a role that has been made redundant.
“Take, for example, a shop with five staff.
“Profit is decreasing due to the pandemic, and now the business only needs four staff.
“The obvious next step to an uninformed employer may be to begin a redundancy process and simply terminate the employment of the fifth role, which is effectively the most recent person employed.”
He continued, “To operate a redundancy process in this manner and on this basis would be very risky because, and, I have to reiterate, the process has to be an objectively fair process and non-discriminatory.
“And whilst it used to be the case that ‘last in, first out’ would be sufficient to make a redundancy legitimate, with the introduction of age discrimination laws in Northern Ireland in 2006, employers would need to be careful about discriminating against ‘young’ workers in a last-in/first-out scenario.
Gervase says that once the decision has been made to reduce staff numbers, the best way to operate a redundancy process is by utilising a selection matrix to help aid objective and transparent decision-making.
You can view a Sample Redundancy Selection Matrix template here.
“The selection matrix essentially sets out the criteria that will be applied in making the selection decision,” he explains.
“Whilst length of service can be one of the relevant criteria in the matrix; it should not be the only one and other criteria frequently used by employers include disciplinary records, qualifications, absence history, skills and performance.
“Once you’ve got your selection matrix populated with the criteria,” Gervase continues, “each employee in the group of potential redundancies is scored against your criteria, and the lowest-scoring employee is selected for redundancy.”
It’s a challenging, stressful process for employers to carry out, he says, but one which is easier to defend if employees challenge the decision robustly.
Gervase advises, “All criteria should have supporting and objective evidence, applied consistently and importantly, be non-discriminatory.”
He adds, “The three main things to remember are: ensure open, transparent communication, ensure there is proper consultation – this is a legal requirement – and that you carry out the process with objective fairness.”
Do you need help with a redundancy process, your employment contracts or any other employment practices?
Find out more by contacting Granite Legal Services today: click HERE.