Tweet

The HR Headache of Making People Redundant

Written by: Jane Caven

Article Overview: For the first time in 20 years, many businesses are finding themselves with a new HR headache – letting people go, rather than struggling to hire enough of them. For many managers making people redundant is a new and unwelcome experience – almost as emotionally difficult for the manager as the employee. In smaller businesses without an HR department to undertake the task for them, managing redundancies can be even harder.

The HR Headache of Making People Redundant

For the first time in 20 years, many businesses are finding themselves with a new HR headache – letting people go, rather than struggling to hire enough of them. For many managers making people redundant is a new and unwelcome experience – almost as emotionally difficult for the manager as the employee. In smaller businesses without an HR department to undertake the task for them, managing redundancies can be even harder.

Jane Caven, Director Sagegreen HR Outsourcing, gives her essential tips for managing redundancies and keeping the remaining team motivated

1. Plan of Action
You need to write a plan of action, setting out who you are considering and why. The plan needs to include target dates for each of the key steps.

2. Warning
You then need to give warning to employees that you are considering making redundancies and why it is necessary.

3. Statutory Duties
You need to check if you have a statutory duty under Section 188 of TULR (C) A 1992 to consult appropriate employee representatives. If you do, you must allow a minimum of 30 days consultation. Even if there is no statutory duty, you may consider consultation anyway.
4. Formal Notification
If 20 or more employees are being made redundant, you need to give formal notification to the Department for Business, Enterprise and Regulatory Reform using Form HR1, a copy also goes to the employee


5. Consultation
The aim of consultation is for you to reach agreement on ways of avoiding, or otherwise, such redundancies and to mitigate the consequences of the dismissals.
The things to consider are: alternatives to redundancies such as shorter working hours, reduced overtime, reducing sub-contractors, work-sharing, voluntary redundancies including early retirement, transfers, re-training and wage reductions.

If redundancies are unavoidable, then you need to draw up objective criteria for the job roles selected.

6. Final Selection
Before final selection is made you must consult with individuals, even if you have had collective consultation earlier in the process. You must write to the employees inviting them to a meeting to discuss the potential redundancy. They are entitled to have a representative, official or otherwise, attend the meeting with them. You must consider the representations that are made to you.

7. Write
If redundancy is the only final option, then you must write to your employees and set out their entitlements, including redundancy payment, pay in lieu, holiday pay. The employee may also have a right to appeal, which must be pointed out.

You need to remember that investigations into alternatives to the redundancy must continue right up until the time the employment is terminated.

8. Consider the Notice Requirement
You also need to consider if the employee should work his or her notice period or not. Consider both the employee affected and the impact on the whole team.

9. Handle the Emotion
Employees will react in different ways: they may stay completely silent, be difficult, argue or cry. You need to stay calm whatever the reaction, show you understand, and give them time to respond. Keep a box of tissues handy and let them compose themselves before continuing.

10. Motivate Those Remaining
The remaining team needs to feel motivated, valued and in control. They need time to adjust to the situation and people will respond at different paces – show you understand and be prepared to listen. Be constructive and share information in a constructive way. Understand their anxieties and where you can, remove their fears. Above all take time for your remaining team – they are the bedrock of your future business.


Whilst every care has been taken in compiling this article, Sagegreen cannot be held responsible for any errors or missions; the notes are not intended as a substitute for legal advice.

Related Articles
  What is your plan B?
  How to make an employee redundant
  Tough Times Giving You A Headache?
  Alternatives to redundancies have benefits
  Choosing a Small Business Web Host

Article Tags: aim, business enterprise, caven, consequences, consultation, dismissals, early retirement, employee representatives, final selection, form hr1, formal notification, hr department, hr outsourcing, objective criteria, regulatory reform, statutory duties, statutory duty, target dates, voluntary redundancies, wage reductions



Related Forum Posts
Re: Essential Leadership skills - Vision Values Mission Strategic Thinking Decision Making Communication Team Bonding People Development Coaching / Mentoring / Guiding / Grooming Presentation Thanks Robert
Making Money in 2011 - Hello forum members! As we draw closer to the new year I thought it would be appropriate to change the title of our forum category "Making Money in 2010" to "Making Money in 2011" - I'm looking forward to some interesting discussions and wish everyone a prosperous New Year!
Magnetic Ads - Biz Idea - Attn Young Entrepreneurs looking for a Business Idea. This came to me while sitting in Traffic for about 1 hour while looking and laughing at ridiculous bumper stickers. Note: this idea is rough but will help get the idea-momentum going. Idea: Sell advertising on the back of cars in the form of reusable magnetic signs (about the length of 2 or 3 bumper stickers) Most people shouldn't have reservations to participating if they get a cut of the monthly fee you charge the company advertising and it doesn't hurt their car. An example of a Magnetic Ad: Geico: I saved 15% on my Car Insurance. Call 1-800-U-SAVE-15 You don't have to pay the cost associated with creating the Magnetic Ad because you will advise the company that this belongs to them and you can get them in touch with someone who created reusable magnets. So your basically managing two sides: 1. Company's that want to advertise 2. People in your neighborhood (to start) who will put the ads on their car. Bigger cars can have more than one ad. Happy Money Making!
Re: Magnetic Ads - Biz Idea - [quote="jvprosperity":32z4qe9w]Attn Young Entrepreneurs looking for a Business Idea. This came to me while sitting in Traffic for about 1 hour while looking and laughing at ridiculous bumper stickers. Note: this idea is rough but will help get the idea-momentum going. Idea: Sell advertising on the back of cars in the form of reusable magnetic signs (about the length of 2 or 3 bumper stickers) Most people shouldn't have reservations to participating if they get a cut of the monthly fee you charge the company advertising and it doesn't hurt their car. An example of a Magnetic Ad: Geico: I saved 15% on my Car Insurance. Call 1-800-U-SAVE-15 You don't have to pay the cost associated with creating the Magnetic Ad because you will advise the company that this belongs to them and you can get them in touch with someone who created reusable magnets. So your basically managing two sides: 1. Company's that want to advertise 2. People in your neighborhood (to start) who will put the ads on their car. Bigger cars can have more than one ad. Happy Money Making![/quote:32z4qe9w] What a brilliant idea. Please more info about the sticker and money involve.
If you had a million dollars... - I'm curious to find out what type of entrepreneurs we have in the forums here. Making money is an obvious part of running your business, but is it everything? How would you complete this sentence: "If you had a million dollars..."?


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Designing Employee-Enhancing Training Programs

Tips for the Novice Traveler

Work Life Balance: Adding White Space

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.