Another HR dilemma - Redundancy
Another HR dilemma:
My Company is considering several redundancies for economic reasons. What criteria should be applied to select staff? I believe we should use the "last in, first out" approach. What do you advise?
Operating a "last in, first out" redundancy policy used to be the easiest option for employers. However, the introduction of the age discrimination legislation in 2006 has made the use of "last in, first out" less straightforward.
If the age profile of your workforce means that most of those selected for redundancy on a "last in, first out" basis are younger employees, you could lay yourselves open to the risk of claims for indirect age discrimination.
Although the legislation does allow you to implement a policy with an age bias to pursue a legitimate aim, this is complex. That doesn’t mean you can’t use “length of service” as one of a number of criteria.
On a more practical level, "last in, first out" does not take account of skills and high performers that you might want to retain to support your business moving forward.
You have a duty to consult staff on ways to avoid redundancy and this should include consulting on the proposed redundancy criteria and for good measure, an opportunity for individuals to appeal against the criteria you set. This will ensure that your selection process is safe (as long as you use the correct scores and avoid maternity and disability counts of absence!)
If you have considered the issues thoroughly, have a paper trail to show your rationale and have provide the opportunity for affected employees to contribute and appeal against decisions, your organisation should be in a far stronger position to defend itself should any discrimination claim arise (age, sex, disability, religion or otherwise).
What criteria do we recommend? Results from performance reviews (objective), timekeeping, absence levels (excluding disability or maternity related) and finally length of service. Add weighting scores according to the relative importance of each criterion to the continued success of your business.
Commercial Hub HR offers outsourced HR Solutions to small businesses within a 100 mile radius of Milton Keynes and Human Resource Consultancy on a project basis to support in house HR functions.
Date: 11/09/2008
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