Changes to consultation process during large scale redundancies

Sweeping changes to staff consultation procedures during large scale redundancies are now being considered by the Government.

Under the current rules, companies must consult with their employees for 90 days if there are likely to be large scale redundancies involving more than 100 employees.

Employment Relations Minister Norman Lamb wants to shorten this consultation period and improve communication between managers and staff. He believes that would reduce uncertainty for workers and make it easier for managers to adapt to the changing economic climate.

The Government has now begun a formal consultation on its proposals which include:

• Introducing a new, non-statutory Code of Practice to give clearer information on how to conduct good quality consultations
• Reducing the 90-day minimum period for large redundancies (over 100 staff) to 45 or 30 days
• Improving the guidance for employers and employees on the support on offer from the Government

Mr Lamb said: “It is never easy for employers or employees when redundancy is a possibility, but it’s clear that the current arrangements are not working in the best interests of either staff or managers.”

He says that it is the quality rather than quantity of consultations that employers need to focus on. He is worried that some companies are losing their best employees unnecessarily.

He said: “At present fear and uncertainty can hang over a workforce for three months, sometimes resulting in some of the best employees choosing to leave, even if they would not have ultimately been made redundant.”

The consultation runs until 19th September. We shall keep clients informed of developments.