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How to fairly select employees for redundancy
Written by Hannah Kennedy on 12 February 2021
Earlier this month, EasyJet made headlines for allegedly using pilots’ sickness records to select for redundancy.
The criteria attracted criticism, particularly in the context of the safety-critical role that pilots undertake and the fact that the company has, quite rightly, previously encouraged pilots to report in sick if they are unfit to fly. The airline has denied the claims, insisting it “would never put forward proposals which would compromise safety” and has “put forward a full range of criteria, including absence, for discussion with the union”.
However, with so many businesses finding themselves having to make these difficult decisions due to the financial impact of coronavirus, the spotlight cast on EasyJet’s alleged redundancy process does raise an important question: what is the fair way to select people for redundancy?
The selection process is essential to a fair redundancy procedure.
If you are shutting down a workplace altogether, selection is not an issue. However, in other redundancy situations, you may need to:
- Identify a pool of potential candidates for redundancy – which might include individuals undertaking the same or similar work duties, who provide cover for each other, or whose skills are interchangeable; and
- Create fair, objective and non-discriminatory selection criteria against which to score and select employees for redundancy.
Examples of fair redundancy selection criteria
There is no ‘one-size-fits-all’ fair selection matrix against which to select employees for redundancy. However, examples of acceptable selection criteria include an employee’s:
- Attendance record
- Disciplinary record
- Standard of work and performance record
- Skills, knowledge, qualifications and experience
These are objective, defined criteria that are capable of being applied in an independent, fair and consistent way. Having multiple people involved in scoring those within the redundancy pool will also help to ensure the process is as fair as possible.
While your criteria should be objective, you may decide to give a different weighting to different criteria depending on the needs of organisation and what you value most.
The above examples can also be quantified, and employers should avoid criteria that is not so easily quantifiable. For example, assessing employees according to their ‘flexibility’, ‘ability to perform as a team player’ or ‘contribution to the company’s creative output’ will be far more subjective and open to criticism. These criteria may also be potentially discriminatory; for example, employees with disabilities or childcare commitments may be less able to be ‘flexible’.
It is a good idea to have written procedures detailing your agreed redundancy selection criteria so that this can be relied upon in such circumstances. Where an established procedure is in place, this should be followed unless there is a very good reason for not doing so.
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Redundancy selection criteria to avoid
You cannot select people for redundancy based on a discriminatory reason. Doing so would render the dismissal unfair and give the employee grounds to bring a claim before an Employment Tribunal.
Here are 7 points to note in order to prevent any suggestion that you have unfairly selected an employee for redundancy:
- You must not select an employee for redundancy based on their age, gender, marital status, sexual orientation, race, disability, religion or belief. You also cannot select them for being pregnant, being on maternity/paternity leave or exercising any of their statutory rights.
- Likewise, it is not permissible to select employees for whistleblowing, being a part-time employee or belonging to a trade union.
- A ‘last in, first out’ approach should be avoided, as selecting employees based on their length of service is likely to disproportionately affect younger workers and may invite claims for age discrimination.
- Care should be taken when using employees’ absence records as a means of selecting staff for redundancy. Absence due to maternity leave, pregnancy and disability should not be counted.
- Selecting employees based on their sickness absence record may be discriminatory if this is connected to an employee’s disability.
- Selection decisions must not be based on managers’ personal preference, prejudice or irrelevant information.
- Ensure that any records you rely on in order to score employees are 100% accurate and up to date.
Remember, a Tribunal will look for evidence of impartial selection according to pre-established criteria that do not depend wholly on the subjective views of managers carrying out the selection process.
Keep a written record of your assessments so that, if required at a later date, you can demonstrate how you arrived at your conclusions.
As mentioned above, using ‘last in, first out’ as a way to select employees for redundancy may constitute indirect age discrimination given that younger workers won’t have had the same opportunity to acquire length of service. It may also result in indirect sex discrimination against women, who are more likely to take career breaks for childcare reasons.
However, in the case of Allan v Oakley Builders and Groundwork Contractors Ltd, a Tribunal held that ‘last in, first out’ was not an irrational method of redundancy selection given that all employees at risk of redundancy were female and the claimant was the oldest (rather than the youngest) person in the pool.
Nonetheless, adopting a ‘last in, first out’ approach to redundancy is not without risk, and employers must be able to demonstrate that this can be objectively justified. It may be reasonable to use length of service in a “tie break” situation where all other factors are equal, but it is not advised to use this as the sole criterion against which to select employees for redundancy.
Agree your criteria with staff
Before finalising your criteria matrix, you will need to consult with your employees and/or employee representative about the criteria. Once it has been approved, you will be a much stronger position to defend your decision if an individual employee decides to challenge it.
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Despite your best efforts, and the various support mechanisms offered by the government, redundancies may be a reality. Indeed, according to a recent survey, 44% of employers are planning redundancies once the furlough scheme ends.
If you’re not confident in approaching and managing redundancy appropriately, our Employment Law specialists can help you to devise a selection matrix that fulfils your organisation’s needs and guide you through the steps required to ensure a fair redundancy procedure.
