EMPLOYMENT LAW TRAINING AND EMPLOYMENT LAW CONSULTANCY

Section Two
 

The Law in More Detail

Article One - How to avoid making redundancy a risky business!

Article Two - Managing Remote Workers

Article One:
How to avoid making redundancy a risky business!

Brief Checklist of key points.

Is it genuinely redundancy?

It is important to answer this question honestly. Is redundancy the genuine reason for reducing your workforce or are you using redundancy as a way of getting rid of an employee who is not performing, who is absent a lot or who doesn't have the right attitude or behaviour? A genuine redundancy arises when the work that was available is no longer available - effectively the job has gone. This may be due to an internal reorganisation, a change to an internal process/procedure or a change to the external market. It is important to remember that it is the job that is redundant, not the person. Using redundancy as a way of getting rid of an unwanted employee could result in an unfair dismissal claim or discrimination claim.

Performance, absence or conduct issues should be managed by using a 'performance improvement' process and/or your disciplinary procedure, not your redundancy management procedure.
(TIP! If you really want to "dress up" a situation as redundancy, wait at least three months before advertising for a replacement, as that is the tribunal claim time limit!!)

Can redundancy be avoided?

Redundancy has such a negative impact upon employee morale and motivation and also upon customer/external perception that it is worth considering if there are any other options that you could use instead of redundancy to reduce costs. For example, reducing over-time or introducing shorter working hours or lay offs, offering early retirement or introducing a recruitment freeze/natural wastage policy i.e. not replacing those employees that leave voluntarily, or introducing an unpaid career break or sabbatical policy.

If redundancy is unavoidable then it is worth asking for volunteers in the first instance. You may even decide to offer an incentive, over and above the statutory redundancy payment in order to encourage volunteers. (If you decide to do this, look seriously at linking the payment to a Compromise Agreement to prevent tribunal claims.) However, if compulsory redundancy is unavoidable then it is important to follow a process that fully complies with all the legal requirements.

Consultation

You are required to carry out a meaningful consultation process. 'Meaningful' means more than just informing. The reason for consulting is to try and find ways of avoiding compulsory job losses. Consultation should include the reason why the redundancy has arisen, how you plan to 'select' individuals for redundancy and finally how the whole redundancy process will be managed. It is also a good idea to explore with employees other ways that redundancy may be avoided. Employees may have suggestions that you have not yet considered!

If a 100 or more employees are going to be affected by redundancy then you must start your consultation process at least 90 days before the proposed redundancy dismissals or at least 30 days if between 20 or 99 employees are going to be impacted. If you fail to consult you could be liable to pay compensation of up to 90 days pay to affected employees. If fewer that 20 employees are affected, there is no obligation to consult "collectively" but individual discussions are still important.

Note; Voluntary redundancies still count towards the numbers required to trigger "collective consultation".

A fair selection process.

It is important to apply a fair selection process in order to identify those employees who may be dismissed because of redundancy. A fair selection process needs to be as objective and quantifiable as possible but may include some subjective, less unquantifiable elements. Quantifiable elements of a fair selection process may include absence records or formal disciplinary records.

When using absence records it is important to make a 'reasonable adjustment' to those absences that may be related to a 'disability' under the Disability Discrimination Act. Also disregard absence connected to pregnancy. Another quantifiable element may be length of service or time in job. It could be argued that this constitutes indirect age discrimination, i.e. a younger employee may be at a disadvantage compared to an older employee who has been employed for longer. Recent case law suggests that employers can defend the use of service as a factor, but do not use it as the only selection criteria (often called LIFO - last in first out!). Other more subjective elements may include technical skills and competencies, flexibility and attitude to work. Once you have decided upon your selection process you will then need to score those employees on a form or matrix.

Notification

You must provide at least 90 days notice to BERR (Department for Business Enterprise and Regulatory Reform) formerly the DTI (Department for Trade and Industry) when a 100 or more employees are going to be affected and at least 30 days notice if 20 to 99 employees are involved.

Dismissal Process

A redundancy is still a dismissal. It is important to follow a sound dismissal process when managing redundancies. This will include a meeting with the employee to confirm that they have been selected for redundancy, a letter confirming this in writing (formal notice of redundancy), which will also confirm their statutory redundancy payment and other rights and an appeal process enabling them to appeal if they feel the decision/their selection is unfair. Redundancy is a potentially fair reason for dismissing an employee, but the process and methods must still meet the requirements of fairness.

Alternative Employment

This may be very difficult if your organisation is small however it is advisable to offer alternative employment if this is a possibility, for example you may need to reduce your telesales team but there may be an administrator vacancy available.

Formal (Written) Notice of Redundancy

You will need to ensure that you provide employees with formal written notice of redundancy which will confirm in writing that they have been selected, the date that their statutory or contractual notice period will commence, the date of redundancy (dismissal), the amount of statutory redundancy pay that they will receive, their right to appeal and their right to paid time off to seek alternative employment.

Statutory Redundancy Payment

If affected employees have more than two years service, they will be entitled to a statutory redundancy payment, which will be dependant upon their age and length of service. For each year they have worked for you, below the age of 22 they will be entitled to 0.5 of a weeks pay, 1.0 of a weeks pay for years worked between the ages of 22 and 40 and 1.5 of a weeks pay for years worked aged 41 and above (no upper age limit now).  The maximum number of years of service that are counted for statutory redundancy payment purposes is 20 years.  A weeks pay is either £350 per week (from Feb 2009) or the employee's actual weekly pay, whichever is the lower amount. Employees will also need to be provided with statutory notice or be provided with payment in lieu of statutory notice. Maximum statutory redundancy pay is therefore 30 weeks @ £350; £10,500

Time off to seek alternative employment

An employee who has been selected for redundancy has a legal right to take reasonable paid time off work in order to seek alternative employment or attend relevant training.

How to avoid traps when making bumping redundancies

As part of the selection process, Employers may consider "bumping", or transferred redundancy. This is where an employee whose job is not redundant is dismissed to make way for an employee whose role has become redundant. Although bumping can be a legitimate way of retaining valued staff while still reducing headcounts, it can also present traps for the unwary.

In the leading case on this, Murray v Foyle Meats Ltd, the House of Lords confirmed the potential fairness of bumping dismissals. What counts is that there is a redundancy situation and that the dismissal of the employee is caused by that redundancy. Even then, employers need to consider alternative employment for the employee to avoid a claim for unfair dismissal.

According to the Employment Appeal Tribunal (in Lionel Leventhal Ltd v North), factors to be taken into account include:

Case law establishes that there is no absolute obligation to consider bumping in all cases, but that a failure to do so may make a dismissal unfair. In North, the EAT indicated that the question of whether it's unfair to dismiss an employee by reason of redundancy without considering bumping is a matter of fact for the tribunal to determine by reference to the particular circumstances. This means that an employer can avoid bumping if there is good reason to do so. On the other hand, bumping can be used if the employer is able to show that the true reason for the dismissal of the bumped employee is redundancy and not some other reason, such as performance, which would take the dismissal outside the scope of redundancy and therefore make it potentially unfair.

Even though employers have considerable flexibility in determining the pool from which employees will be selected for redundancy, they must still act reasonably or run the risk that any dismissals will be deemed unfair. When assessing if an employer has been reasonable in deciding on a selection pool, a tribunal will consider factors such as whether other groups of employees are doing similar work, whether employees' jobs are interchangeable and whether the selection pool was agreed with an employee representative.

If you have any further queries, which relate to either redundancy, managing performance, absence or conduct issues then contact us now - 01789 470700.

 

 

Article Two:
Managing Remote Workers

The cold weather this winter resulted in many travel delays and road traffic warnings, but for an increasing number of people the journey to work is from kitchen to home office, where the only real hazards might be tripping over the dog or falling on a child's toy left from the night before!

There has been quite a shift in recent years towards "remote working", which falls broadly into two categories; working from home, or working alone - out on site perhaps. The latter group can incorporate a surprising number of workers, for example;

People in fixed establishments where:

Mobile workers working away from their fixed base:

These two different ways of working attract their own problems as far as "management" is concerned, for although the two styles are very different in practical terms, the challenges they present are very similar.

Firstly, there are Health and Safety issues to be addressed.

Employers owe a duty of care to all Employees, irrespective of the way that they work, but where the work is carried out away from the main base of the business, specific issues need to be addressed. Due to the lack of close supervision, lone workers can be tempted to take short cuts with safety issues - more so than employees whose boss is in the vicinity.

It is the employer's duty to assess risks to lone workers and take steps to avoid or control any risk where necessary. It is a legal duty on every Employer to carry out regular risk assessments. Where five or more employees work in the business, these risk assessments must be written down, duly recording any significant risks identified and the steps taken to reduce those risks. Employees also have responsibilities to take reasonable care of themselves and other people affected by their work and to co-operate with their employers in meeting their legal obligations. So Employees have a duty to wear protective clothing issued by the Employer, or apply sunscreen if working outside in hot weather.

There are no general legal restrictions on employees working alone; it depends largely on the results of the risk assessment. However, some jobs in certain industries (including diving, explosives, fumigation work for example) are covered by specific industry regulations, which the Employer must make themselves and the employees aware of.

A short checklist may help;

A second issue which affects managing remote workers (whether working from home or working alone) relates to performance management.

The old adage "out of sight out of mind" still rings true to some managers, perhaps indicating a lack of trust when the work is done away from the centre. Perhaps for some it is a case of "out of site out of mind"!!

Again, it must be emphasised that careful recruitment is a key factor here. Not every employee adapts to working alone, for a variety of reasons, so the recruitment criteria must be clear, identifying the characteristics that go with being able to work using own initiatives. The use of selection tests and personality tests can be a useful aid to the tried and trusted interview here.

Technology continues to advance at a tremendous pace too, and this development can now also help in the management of remote and mobile workers. One Company that specialises in Employee Management technology is Crown Computing. As John Moody, from Crown explains with one example;

"Technological advances mean that increasingly mobile and remote workforces can also be managed and monitored by the same systems previously only available "in-house". Using different forms of mobile or portable technology, it is possible to capture the required data - typically involving the Personal Digital Assistant (PDA) type device or mobile phone. For ease of use and pure simplicity of operation one technology in particular is generating significant interest and that is Near Field Communication (NFC) enabled mobile phones. The technology is being used in consumer applications where the phone can be used to make purchases, travel tickets and access to mobile services. This is a form of technology, which is embedded into the handset - the phone is programmable so the first step is for the user to login to the phone in the same way as they would to a computer, which confirms the identity of the employee. The employee could then be presented with a menu, which for example would allow them to register the time they started work and "book on" to a particular job or activity.

For business applications the tag can be used to represent a location, a vehicle or an item of equipment (the tag would be physically secured to the location, vehicle or equipment), so when the employee scans the tag with their phone the resultant transaction confirms the identity of the employee, the date and time and the fact that they have arrived at a location, got into a vehicle or have started to service an item of equipment. This information is delivered in real time to the centre providing vital information to the employer.

This technology is useful for any application where you want to place people at specific locations, in real time - a security guard doing a tour, an engineer servicing equipment, homecare visits and field maintenance, where it is not only useful for service delivery monitoring but also for lone worker protection purposes.

Opportunities for productivity improvements will also be more readily apparent. In addition to the benefits of providing service delivery information to the business in real time, such use of such technology also cuts down on administrative costs (doing away with the need for people to fill in a timesheet , with all of the inaccuracy associated with that process) and provides automated inputs into the Payroll for payment purposes and into Finance systems for costing or charging purposes."

Therefore despite the challenges posed by these developments in ways of working management can obtain plenty of help to protect and support these vital workers.
John Moody of Crown Computing Limited.  A software house providing solutions for Employee Management  www.crowncomputing.co.uk