Redundancy and Selection Criteria
To ensure that any redundancy process is just and legal, redundancy selection criteria must be used correctly.
The following advice focuses on how to pick and employ the best redundancy criteria and how to reduce the chances that you’ll break your duties when you fire someone.
How to select employees for redundancy
You must choose which staff will be let go if your organisation has undergone a restructuring, or if a slump in business has caused you to make severe financial sacrifices.
You will need to determine the group of employees who will be at risk of being laid off if you are compelled to reduce your payroll responsibilities. This may have an impact on all sections of your firm. This is referred to as the selection pool, and it is to this group that your redundancy selection criteria will be applied.
Certain job roles might have automatically become obsolete in cases when your organisation has undergone a thorough restructure. However, it is crucial to remember that even in cases when specific jobs may be lost, the selection pool should not be limited to people who are already working in those positions but should instead include all employees who are able to perform the necessary tasks. Employees that perform the same or equivalent responsibilities in other departments of the company or at several locations fall under this category.
If your entire organisation is shutting down and there are no alternative sites to take into account, there is no need to choose a pool for redundancy. Additionally, if the redundant position is unique, it may be quite fair to concentrate on just one employee without adding any redundancy selection pool.
Identifying the Selection pool
When choosing which employees to choose from the pool of those at risk of being laid off, you must use a fair selection process. Although you as the employer have a reasonable amount of discretion in choosing the redundancy selection criteria to utilise, you shouldn’t try to stray from the criteria specified in any documented redundancy processes without a valid reason. Additionally, if a process for selecting layoffs has been agreed upon with a trade union, you should adhere to it.
Instead of using subjective criteria that are difficult to measure and can’t be used independently, you should always aim to utilise objective criteria that are easily measurable and capable of being used in any written redundancy procedures.
Fair selection criteria for employees can include things like:
- An employee’s performance or standard of work
- Talents, credentials, and/or experience of a worker
- The attendance and/or disciplinary history of an employee.
This is not a complete list of redundancy requirements. Applying a variety of distinct redundancy selection criteria, or criterion combinations can help you keep the employees who are most valuable to your company’s future and have the requisite training and expertise.
Applying the selection criteria for redundancy
You must treat the pool of workers who are at risk of being laid off fairly, consistently, and, whenever feasible, on the basis of an objective evaluation supported by convincing evidence.
To help you avoid depending on one criterion and to reduce the possibility of unfairness, it is frequently a good idea to score candidates against the established selection criteria. Having said that, you may use this weighting approach to be more flexible in how you grade people by deciding which redundancy criteria are more essential and altering the points accordingly.
However, it is not a strict requirement that redundancy criteria must only be able to be scored or evaluated by a “box-ticking” exercise to be valid. Even though every effort should be made to employ objective metrics, there will often be some amount of judgment involved. For instance, performance statistics should be supplemented by written performance reports or appraisals. In order to provide employees with a clear understanding of how they have been evaluated, you should also present thorough written evidence to support your score or conclusion.
Selection process and redundancy selection criteria matrix
The various factors that will be considered in determining which employees to make redundant, such as a combination of aptitude, performance appraisals, and disciplinary records, are defined in a redundancy selection criteria matrix.
Then, each employee in the redundancy pool is graded according to each of the matrix’s criteria. The lowest-scoring employees would then be chosen for layoffs.
You may reduce the possibility of any complaints by using a redundancy criterion matrix to help you develop a transparent decision-making process and apply each of your criteria fairly. Employees will understand what is being considered and how redundancy decisions have been made as a result.
What happens in case there are no fair selection criteria
As long as there is a true redundancy scenario and the selection procedure is fair, redundancy is a potentially acceptable grounds for termination. Your company could easily be subject to a pricey claim for unfair dismissal if you use redundancy selection criteria that are unjust or discriminatory.
Commonly, accusations of unfair dismissal will surface when an employer’s use of the redundancy criterion results in either a direct or indirect bias against a particular individual or group of employees.
In the section below, we examine automatic unfair dismissal in the context of discrimination as well as the usage of the conventional last-in-first-out technique, which has the potential to have discriminatory effects on its own.
You cannot discriminate against any individuals or groups when making redundancy. This means that none of the nine protected characteristics listed in the Equality Act of 2010—age, handicap, gender reassignment, marriage and civil partnership, pregnancy and motherhood, race, religion and belief, sex, or sexual orientation—may be used to make employment decisions.
It would be considered automatically unfair to choose an employee for redundancy based on any one of these nine criteria. Other selection criteria are likewise automatically unjust, therefore you cannot decide whether to lay off a worker based on any of the following:
- Family leave, such as parental, paternity, or adoption leave, or time off for a worker to look after a dependent
- An employee who is serving as a union representative
- A worker’s decision to join or not to join a union
- a worker who is part-time or hired for a set period of time
- a justification pertaining to compensation or working conditions, such as an employee requesting the federal minimum wage, holiday pay, rest periods, or the right to opt out of the maximum weekly working hours.
It is frequently a good idea to employ criteria that are objective, measurable, and do not by themselves bias against specific people or groups in order to avoid any potential discriminatory impacts.
However, even with certain objective redundancy criteria, care must still be taken. For instance, if an employee’s attendance record is used, it must not include absences due to maternity or pregnancy leave or disability.
Fair redundancy selection
Prior to the adoption of anti-discrimination and equality laws, many businesses would frequently implement the last-in-first-out strategy, which made it simple to fire employees with the shortest tenures. However, due to its ability to inadvertently bias against younger workers or women who often have shorter working periods, this method is now universally dismissed as the exclusive method of selection for redundancy.
A person (A) discriminates against another (B) whenever A applies to B a provision, criteria, or practise (PCP) that is discriminatory in relation to a relevant protected characteristic of B’s, according to the 2010 Act’s definition of indirect discrimination. In relation to a crucial protected trait of B’s, a PCP is discriminatory if:
- It puts or would put, people with whom B shares the characteristic at a specific disadvantage in comparison to people with whom B does not share it.
- A applies or would apply, it to people with whom B does not share the characteristic.
- B would be at a disadvantage as a result, and A is unable to demonstrate that it is a reasonable way of pursuing a legal objective.
Due to these statutory requirements, in order for the last-in, first-out policy’s potential discriminatory effects to be justified as fair, you must be able to demonstrate that it is a proportionate means of achieving a legitimate business goal, such as rewarding loyalty or maintaining a stable workforce.
However, it is important to keep in mind that when weighting different criteria to reflect the most crucial aspects for the future of your business, last-in-first-out should not be weighted more highly than any other criteria. Additional redundancy criteria will frequently be required to lessen the effects of any discrimination. Most often, in a tie-breaking circumstance where two employees have equal scores on, say, performance and skills, this procedure should be applied.
Tips for a fair redundancy procedure
Where at all possible, choose objective redundancy selection criteria. This will help you to assess the pool of employees at risk of redundancy in a clearly defined and measurable way, rather than based on opinion.
If you choose to apply criteria involving qualitative data, any assessment must be carried out by someone with direct and specific knowledge of the employee’s work and be supported by written evidence.
Before finalising your redundancy selection criteria, consult with any employee or trade union representatives as to the selection criteria proposed to be used.
If it is accepted, you will be in a far better position to defend your choices if they are contested by certain personnel.
Only consider a person’s performance or disciplinary history when evaluating them if reviews, evaluations, and rules have been applied equally and consistently to all of the employees in the redundancy pool. In order to get a more realistic picture, you should also use a fair timeline and disregard any previously issued disciplinary warnings.
If necessary, request that staff reapply for their employment so that you can choose who to hire. To make sure you are choosing people fairly, you must still apply objective criteria when conducting interviews. Provide an appeals mechanism for workers who feel they were unfairly chosen, and you’ll lessen the likelihood that someone would file a claim against you with an employment tribunal.
Document your redundancy selection criteria and how you used them to narrow down your selection pool in writing. This should provide specific evidence used to back up any conclusions reached.
Get in touch
The employment attorneys at Clarity Simplicity can assist with all facets of the redundancy procedure, including legal selection criteria for redundancy and how they affect procedural fairness. We provide thorough advise on minimising the legal risks of terminating employees, including more complex scenarios involving furloughed workers and structuring settlement agreements, in close collaboration with our HR specialists. Speak to our professionals for guidance and assistance.
What are the redundancy selection criteria?
Redundancy selection criteria might vary, although it is frequently preferable to utilise criteria that are based on facts rather than subjective judgements. This could include, for instance, a worker’s calibre and performance, their abilities, credentials, or experience, or even their punctuality and disciplinary history.
Can service length be considered when making redundancy decisions?
Length of service can be employed in the redundancy selection process. For instance, the last-in-first-out technique selects employees first based on how long they have worked for the company. To decrease the consequences of discrimination against young people and women, who typically have shorter employment spans, this is, however, frequently only employed in conjunction with other selection criteria.
A redundancy selection
The factors that will be taken into consideration when determining which employees will be laid off are outlined in a redundancy selection criteria matrix. The employees with the lowest scores are then chosen for redundancy out of the redundancy pool after each employee is assessed against each of the criteria.
What justifications exist for making someone redundant?
A person can only be made redundant in cases of actual redundancy. This could happen as a result of your company changing what it does or how it does things, such as by implementing labor-saving technologies or completely restructuring to cut expenses.