Redundancy Do’s & Dont’s

Whilst we are not experiencing the same level of redundancies of late as in recent years the EAT still takes a dim view of employers who don’t fall due process and procedure when terminating employment due to redundancy.

In a recent case (UD814/2013) a former employee was awarded almost €44,000 for unfair dismissal on grounds of redundancy (a sum which was then reduced by the amount of statutory redundancy already received). The employee concerned had been contacted informally whilst still on maternity leave and not informed in advance that the meeting in a coffee shop was to discuss her potential redundancy due to poor business conditions.  The employee said she felt she had no choice but to take redundancy and was not offered an opportunity to put forward any alternatives. Furthermore, the temporary contract of the employee who was covering her maternity leave was extended when she agreed to the redundancy.  Whilst the EAT acknowledged that the business had declining revenues and had also implemented other redundancies, they highlighted some useful points that should be considered in all redundancy situations and which ultimately was very costly for the employer in this case:

  • Redundancy is not about the person but about the role and whether the role is still required;
  • Consultation must be undertaken with all employees who are potentially going to be made redundant;
  • Alternatives that are put forward must be considered (e.g. reduced hours, reduced wages etc ) prior to implementing a redundancy;
  • The subject of redundancy should be dealt with in a formal manner and notice of the subject matter of meetings given in advance.