“ACAS advice for bosses is to exhaust all possible alternatives to redundancies first,” ACAS Chief Executive, Susan Clews has said, “but if employers feel they have no choice then they must follow the law in this area.” A new survey has found that over a third of employers (37%) are likely to make staff redundancies in the next three months.

ACAS commissioned YouGov to ask British businesses about their redundancy plans and knowledge of the law in this area. The poll found that:

• Six out of ten large businesses said they were likely to make redundancies in the next three months.
• For businesses that are likely to make redundancies, over a quarter (27%) said they plan to do this remotely over video chat or a phone call.
• One in four (24%) bosses are unaware of the law around consulting staff before making redundancies – this increases to one in three (33%) where businesses have fewer than 50 workers.

Clews continued:

“Businesses are facing extremely difficult circumstances due to the coronavirus crisis and our poll reveals that many are considering redundancies. Our survey reveals that a third of small businesses do not know about their legal responsibilities on consulting staff when considering redundancies. It is important for them to act responsibly and follow our advice or they could be subject to a costly legal process.”

If an employer finds there are no other choices than to make redundancies then there are strict rules on consulting staff that they must follow. An employer must discuss any planned changes and consult with each employee who could be affected. This includes staff who may not be losing their jobs but will be impacted.

The minimum consultation period varies depending on the number of employees that an employer wishes to make redundant. By law, employers who plan to make 20 or more staff redundant over the next three months (90 days) must also consult a recognised trade union or elected employee representatives about the proposed changes.

For 20 to 99 redundancies, consultation must start at least 30 days before the first dismissal can take effect, and for 100 or more redundancies, it has to start at least 45 days before.

If an employer does not meet consultation requirements, employees can take their employer to an Employment Tribunal. If successful, the employer may have to pay up to 90 days' full pay for each affected employee. Someone can also make a claim of unfair dismissal to an Employment Tribunal on the grounds that they were not consulted, or the consultation was not meaningful.

Consulting employees and unions may help to find alternative solutions to making redundancies.

Read ACAS advice for staff and employers about redundancies.