Employers are now having to contemplate their post-COVID-19 future. As such, redundancies appears to be a likely outcome, especially during the phased withdrawal of the Coronavirus Job Retention Scheme (CJRS aka furlough payments).
An employer in financial difficulty often needs to reduce the number of its employees by making roles redundant. A redundancy is a potentially fair reason for dismissal, in selecting those to be made redundant, the employer must act reasonably.
It is vital that employers follow the correct procedures, including the correct redundancy consultation process. Failure to follow the process, even with a genuine redundancy scenario can result in findings of unfair dismissal at the Employment Tribunal. To ensure that you follow the right procedures it is recommended to take legal advice to reduce your potential legal liabilities.
Whilst the right to claim unfair dismissal only arises after two years of service, selection for a discriminatory reason can result in an Employment Tribunal claim. We advise a best practice approach for all employees.
Redundancy should be the last resort. Employers should explore other options such as restricting overtime or a recruitment freeze. We can advise whether the situation that your business is faced with is a genuine redundancy scenario.
If redundancy is necessary we can assist in devising a process by which to follow dependent on the number of redundancies envisaged. We can assist in advising how to establish a selection pool and considering the criteria to apply in the circumstances to ensure that the selections are non-discriminatory. We can assist in ensuring the appropriate amount of redundancy is paid.
Employees who have been employed for two years or more are entitled by state to a redundancy payment on a sliding scale, calculated in accordance with age and length of service. Some employers provide their employees with a contractual right to an enhanced redundancy analyse your employees contractual position.
Most tribunal cases concerning redundancy revolve around the following criteria:
- Whether the people selected for redundancy are actually redundant;
- Whether they have been selected for some unfair reason;
- Whether proper individual consultation and/or collective consultation has been implemented;
- What is the correct amount of compensation to which any redundant person is entitled.
During a redundancy process, employers will often seek voluntary redundancies from their employees. This can lessen their potential legal liability to an unfair selection process. We can advise you on this process, draft the agreements and advise on how to achieve the best settlement.
In return for signing away their rights to claim, the employee will usually receive a compensation payment. The first £30,000 of this compensation is usually tax free.
When signing a settlement agreement, the legal advice for the employee is usually funded by the employer though the advice is independent. It is a requirement that the employee takes advice and it is signed off by both the employee and his legal advisor.
We understand that this can be a very difficult time for your business. We can offer clear advice to help protect your interests and achieve the best result for you in your situation
Our Employment Fees and Costs
Our employment solicitors are:
Scott Taylor (Solicitor with at least 8 years’ experience)
Ben Tighe (Solicitor with at least 8 years’ experience)
Max Hornigold (Solicitor)
Angela Giannotti (Solicitor – London)
Chris Bennett (Junior Executive – London)
Our hourly charges are as follows:
Private (Leeds and Middlesbrough) :
Partners/Solicitors with at least 8 years’ experience – 265.00
Solicitors with at least 4 years’ experience – 230.00
Solicitors, Legal Executives, Senior Executives – 200.00
Trainee Solicitors – 140.00
Junior Executives/Assistants – 140.00
Private (London) :
Partners/Solicitors with at least 8 years’ experience – 450.00
Solicitors with at least 4 years’ experience – 325.00
Solicitors, Legal Executives, Senior Executives – 250.00
Trainee Solicitors – 150.00
Junior Executives/Assistants – 150.00
Lesser complexity case
This would tend to be a case where unfair dismissal is the sole claim and the matter is limited to a one-day hearing.
It would be in the region of £15000-£18,000 plus VAT and disbursements (if we instruct counsel).
Medium complexity case
This would be a case where there are additional claims to unfair dismissal, such as discrimination. This would also apply where the case for unfair dismissal requires a Preliminary Hearing or where the case is listed for a Final Hearing of two or three days’ duration.
This would be in the region of £20,500- £23000 plus VAT, plus counsel fees of approximately £1,500 for the first day of the Final Hearing and £1,000 for the refreshers for the second and subsequent days of the Final Hearing. .
Higher complexity case
This would be a case where the unfair dismissal claim involves multiple discrimination complaints or complex matters such as whistleblowing/making of protected disclosures and where the case is listed for a Final Hearing of two or more days’ duration.
From £20,000 to £25000 plus VAT, plus counsel fees of £1,500 for the first day of the Final Hearing and £1,000 for the second and subsequent days of the Final Hearing.
The following factors can have an impact on the complexity of a case:
- Defending claims that are brought by litigants in person
- Complex preliminary issues such as whether the claimant is disabled (if this is not agreed by the parties)
- The number of witnesses and documents
- If it is an automatic unfair dismissal claim. For example if the reason for dismissal is because of a protected disclosure or an employee’s pregnancy or maternity leave
The fees set out above cover all of the work in relation to the following key stages of a claim:
- Taking initial instructions, reviewing the papers and advising on merits and likely compensation
- Entering into pre-claim conciliation
- Preparing a claim or response
- Reviewing and advising on a claim or response from other party
- Exploring settlement and negotiating settlement throughout the process
- Preparing a schedule of loss
- Preparing for and attending a Preliminary Hearing
- Exchanging documents with the other party and agreeing a bundle of documents
- Taking witness statements, drafting statements, and agreeing their content with witnesses
- Preparing bundle of documents
- Reviewing and advising on the other party’s witness statements
- Agreeing a list of issues, a chronology and/or cast list
- Preparation for the Final Hearing or instructions to Counsel
The stages are not fixed and guaranteed, and we will adjust our costs accordingly when some stages are not required.
How long will my matter take?
The time that it takes from taking your initial instructions to the final resolution of your matter depends largely on the stage at which your case is resolved. If a settlement is reached during pre-claim conciliation, your case is likely to take 2-4 weeks. If your claim proceeds to a Final Hearing, your case is likely to take 9-18 months. This is just an estimate and we will of course be able to give you a more accurate timescale once we have more information and as the matter progresses.
Disbursements
Disbursements are costs related to your matter that are payable to third parties, such as court fees. We handle the payment of the disbursements on your behalf. Disbursements incur a VAT charge of 20%.
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