REDUNDANCY CONSULTATION AND NOTIFICATION (PL833 Rev 6) 

Rights of employees and their representatives

Employees and their representatives have certain rights and protections to enable them to participate fully, effectively and without fear of victimisation in the process of consultation. These are described below.

In a case where representatives are specially elected, it is automatically unfair for the employer to dismiss any employees wholly or mainly because of:

• their participation in the election, either as candidates or as voters;

• their status or activities as elected representatives;
  
• It is also unlawful for the employer to take other detrimental action, short of dismissal, against any employees on these grounds.

The rights of trade union members and officials are contained in separate provisions of the legislation but are essentially the same. Further details may be found in the document Union membership: rights of members and non-members (PL871).

The employer is required to allow employee representatives reasonable access to their constituent employees and to such accommodation and other facilities - e.g. use of telephone - as is appropriate. What is appropriate will vary according to the circumstances.

Employee representatives - whether trade union or not - have a statutory right to reasonable time off with pay during their normal working hours to perform their functions, and also to undergo appropriate training to enable them to do so. The legislation does not specify the amount of time off that it is reasonable to allow since this will vary according to the circumstances. Payment should be at the appropriate hourly rate for the period of absence from work. This is arrived at by dividing the amount of a week’s pay by the number of normal working hours in the week. The method of calculation is similar to that used for statutory redundancy payments. Further details may be found in the document Redundancy entitlement - statutory rights: a guide for employees (PL808).

Employees or representatives who consider that their rights as described in this section have been infringed may seek redress by making a complaint to an employment tribunal. (See Section Complaints to employment tribunals of this document for further details).  A complaint will not normally be considered unless it is made within three months of the date when the alleged infringement occurred (although in exceptional cases where the tribunal considers that it was not reasonably practicable for a complaint to be made in time it can allow a longer period).

If the tribunal finds that a dismissal was unfair, it may order the employer to reinstate or re-engage the employee or make an appropriate award of compensation. Employers may therefore also wish to see documents Unfairly Dismissed? (PL712) and Dismissal - fair and unfair: a guide for employers (PL714). If it finds that other unlawful detrimental treatment occurred, it may order that compensation be paid.

If the tribunal finds that the employer has failed to allow employee representatives reasonable access or appropriate facilities, it shall make a declaration to that effect and may make a ‘protective award’ of compensation. (See Section Redress in cases where employers have failed to meet their information and consultation obligations of this document for further details).

If the tribunal finds that a representative was unreasonably refused time off, it shall make a declaration to that effect and award to the representative an amount equal to the pay to which he or she would have been entitled if time off had not been refused. If the tribunal finds that a representative did not receive appropriate pay for time off, it shall order the employer to pay the amount due.

Redress in cases where employers have failed to meet their information and consultation obligations

A complaint may be made to an employment tribunal that an employer has failed to meet the requirement to inform and consult in accordance with the statutory provisions. (See Section Complaints to employment tribunals of this document for further details.) A complaint about a failure relating to the election of employee representatives may be made by any of the affected employees or by any of the employees who have been dismissed as redundant; a complaint about any other failure relating to employee representatives may be made by any of the representatives to whom the failure related; a complaint about a failure relating to trade union representatives may be made by the trade union; and in any other case, a complaint may be made by any of the affected employees or by any of the employees who have been dismissed as redundant.

A complaint will not normally be considered unless it is made within three months of the date on which the last of the dismissals takes effect (although in exceptional cases where the tribunal considers that it was not reasonably practicable for a complaint to be made in time it can allow a longer period).

Where the tribunal finds a complaint justified it will make a declaration to that effect. In appropriate cases, whether or not the employees are still employed, the tribunal may take steps to safeguard the employees’ remuneration by making a "protective award". It can do this at the same time as it makes the declaration or later, after a further application to the tribunal.

The employer is required to pay employees covered by a protective award their normal week’s pay for each week of a specified period, known as the protected period, regardless of whether or not they are still working. To be covered by an award, employees must belong to a group specified in the award, they must be employees whom the employer plans to dismiss or has already dismissed as redundant and they must be employees in whose case the employer has failed to comply with the information and consultation requirements. The protected period will begin with the date on which the first dismissal takes effect or the date of the tribunal award - whichever is earlier. The length of the period will be determined by the tribunal, taking into account the extent of the employer’s failure to consult and any extenuating circumstances. It is however subject to an upper limit of ninety days in all cases.

A week’s pay is calculated by reference to a certain date which is known as the "calculation date".

The calculation date for computing payments under a protective award is:

• where the employee is dismissed before the date of the award - the same date as the calculation date for computing a redundancy payment, whether or not the employee is entitled to a redundancy payment;
  
• where the employee is still in employment - the date on which the award was made.

The method of calculation is similar to that used for the purposes of statutory redundancy payments. Further details may be found in the document Redundancy entitlement - statutory rights: a guide for employees (PL808).

Subject to certain conditions (see below), the payment under the protective award must be made in addition to any payment that an employee is entitled to under a contract of employment (or as damages for breach of that contract) for any part of the protected period.

The employer must deduct from the award and repay to the Department for Work and Pensions an amount equivalent to any Jobseeker’s Allowance or income support that the employee has received for any part of the protected period. The tribunal, when it makes the protective award, will advise the employer that certain information should be sent to the nearest Jobcentre Plus office within a specified period. On receipt of this information the Jobcentre Plus will advise the employer on a document called a "recoupment notice" of the amount of benefit that has been paid. A copy of this notice will be given to the employee. Only after the employer has received this notice, or a letter stating that recoupment is not appropriate, can any part of the award be paid to the employee.

Employees who are still employed will be paid under a protective award only when they would be entitled to be paid under their contract of employment or under their statutory rights during a period of notice. For this purpose the whole remaining part of their employment is treated as if it were a statutory period of notice. This means that employees who go on strike, or are absent from work without good reason, or are granted unpaid leave at their own request, or have time off from work under certain provisions of the Employment Rights Act 1996, will not be entitled to payment. But employees who are absent under contractual holiday arrangements, or because they are ill, or because of pregnancy or childbirth, will be entitled to payment. They will also be entitled to payment during any period where the employer has no work available for them.

Employees who are fairly dismissed for a reason other than redundancy, or who give up their job during the protected period without good reason will, however, lose their right to payment for the rest of the protected period.

An employer may offer an employee re-engagement, either in the old job or in different but apparently suitable work, before the end of the protected period. An employee who refuses such an offer without good reason will lose the right to payment for the rest of the protected period.

An employee who accepts an offer of alternative work is allowed a trial period to see if the work is really suitable. For the purposes of calculating continuity of employment this trial period is regarded as starting from when the employee’s old job ends even where there is in fact a gap between jobs. The trial period will normally continue for four weeks after the employee starts work but may be extended by agreement between employer and employee in order to retrain the employee for the new work. Employees who leave their work with good reason or who are dismissed (for example because they are unable to carry out the duties of the new work or the training) during the trial period retain their rights to payment under the protective award. If, however, they give up the work or training without adequate reason or the employer dismisses them fairly for reasons unconnected with the changed terms of employment - misconduct, for example - they will lose their right to payment for the rest of the protected period.

The trial period may be extended to retrain the employee for the new work, by agreement between the employer and the employee. Such agreements must be made before the employee starts the new work; must be in writing; and must specify the date that the trial period ends and terms and conditions of employment that will apply after that date.

The periods allowed for trying out the new work are the same length (four weeks extended by any agreed training period) as for the purposes of assessing entitlement to statutory redundancy payments. In this case, however, employees have a right to a trial period if they start a different job with their employer at any time during the protected period and it makes no difference whether the employer offers them work before or after the end of the old job.

If an employer fails to pay money due to an employee under a protective award, the employee has a right to complain to an employment tribunal. (See Section Complaints to employment tribunals of this document for further details.) Where a number of employees complain in connection with a single protective award, a test case may be arranged by agreement between the parties.

A complaint must normally be made within three months of the last day for which there has been an alleged failure to pay (although in exceptional cases where the tribunal considers that it was not reasonably practicable for a complaint to be made in time it can allow a longer period).

If the tribunal is satisfied that the complaint is justified it will order the employer to pay the employee or employees concerned the money due to them under the award.

Notification to the Department of Trade and Industry

Introduction

An employer who proposes to dismiss twenty or more employees as redundant at one establishment within a ninety day period has a statutory duty to notify the Secretary of State for Trade and Industry. This is so that government departments and agencies and the Jobcentre Plus Rapid Response Service can be alerted and prepared to take any appropriate measures to assist or retrain the employees in question¹. It makes no difference whether the redundancies are to be ‘compulsory’ or ‘voluntary’; so notification must still be given even if it is proposed to dismiss only volunteers².

A notification must be made a specified minimum time before the first dismissal takes effect. The date of notification is the date on which it is received by the Department of Trade and Industry.

The minimum times are:

• if between twenty and ninety-nine employees may be dismissed as redundant at one establishment within a ninety day period - at least thirty days;
  
• if one hundred or more employees may be dismissed as redundant at one establishment within a ninety day period - at least ninety days.

These periods are the same as the minimum periods permitted for consultation with employee representatives. An employer who has already notified one group of proposed redundancy dismissals and later finds it necessary to make a further group does not have to add the numbers of employees together to calculate the minimum period for either group. There is no obligation to notify redundancies of fewer than twenty employees within a ninety day period, but employers may nevertheless wish to consider doing so in borderline cases - particularly if the numbers involved are uncertain.

The Department of Trade and Industry requires information in writing about the employer’s proposals. Employers may notify by letter or by form HR1, which can be obtained from any Redundancy Payments Office or Jobcentre Plus office. The information required is similar to that which the employer must disclose to employee representatives for consultation purposes. (See Section Employers' information and consultation obligations of this document.) In addition, the notification must state where and with whom such consultation began.

The notification should be sent by post or delivered by hand to the office indicated on form HR1. If the employer’s proposals change significantly after the notification has been given - for example, if the numbers to be dismissed increase by twenty or more or if the dismissal dates are to be brought forward or delayed - the Department should be informed. Employers must give or send a copy of the notification to the representatives with whom they are required to consult about the proposed redundancies. The Secretary of State has powers to obtain further information if necessary. When notification has been received in the form required, a formal acknowledgement will be sent to the employer.

There may be special circumstances where it is not reasonably practicable for the employer to meet fully the requirements for minimum notification periods. In such circumstances, the employer must take all reasonably practicable steps toward meeting the requirements and explain why they cannot be met in full. However, it is not sufficient simply to state that it was not possible to comply because a controlling body (e.g. a head office or parent company) had not supplied the necessary information or had not supplied it in time.

If an employer fails to give the required notification to the Department, the Secretary of State may institute legal proceedings that could lead, on summary conviction, to a fine of up to £5,000. (This upper limit is subject to review from time to time).

Complaints to employment tribunals

Application forms and explanatory leaflets for making employment tribunal complaints may be obtained from any local Jobcentre Plus office. Advice may also be obtained from the Advisory, Conciliation and Arbitration Service (Acas). When the tribunal receives the completed application form it will send a copy of it to an Acas conciliator who, if conciliation is possible, will attempt to get both sides to reach a settlement. Information given to a conciliator in the course of his or her duties is treated as confidential. It may not be divulged to the tribunal without the consent of the person who gave it. If no settlement is reached, the tribunal will hear the case. Hearings are conducted informally. The parties may claim travelling and other expenses, including loss of earnings, within certain limits. They have the option to be represented by a solicitor or by any other person of their choosing, such as an official of a trade union or an employers’ association. Such representation is not required, however.

¹ Help may also be available from local authorities particularly when the possibility of redundancy is caused by potential difficulties over site location or relocation, or matters related to planning requirements.  Many authorities have special industrial units which provide an advisory service for industry.  Employers may find it useful to get in touch with these at an early stage before commitments have been made.

² Notification to the Secretary of State does not mean that the dismissals have to occur.

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Last updated 12 March 2003