The Coronavirus Job Retention Scheme (‘CJRS’) closed on 30 September 2021, 18 months since it was first launched. Introduced in March 2020 as a reactionary measure to prevent mass redundancies in the face of the COVID-19 crisis, the closure of the ‘furlough’ scheme demonstrates the long awaited reopening of the economy. Although a return to ‘business as usual’ for most industries is to be welcome, the closure of the CJRS scheme is likely to result in employers considering difficult decisions relating to their workforce. Employers may wish to avail of temporary lay-off, short-time working and redundancy to manage their staffing levels. If you find yourself faced with such questions, here is an overview.

Lay- offs and Short -Time Working

A lay – off occurs when there is not enough work for an employee to perform and they subsequently find themselves off from work for at least 1 working day. Short – time working is where an employee works reduced hours and receives less than half a week’s normal pay. During lay- off or short- time working, employees are entitled to a guaranteed payment of £30 per day for 5 days within any 3 month period (not exceeding £150).  Although employers do not automatically have the right to lay -off employees or put them on short- time working, these working term arrangements can be incorporated into an employee’s contract in various ways:

• Being expressly written into their contract
• Being implied through custom or practice; or
• Agreed by the employer and employee concerned

What next?

If an employee finds that they have been laid-off / put on short- time working for 4 consecutive weeks, or for any 6 weeks within a 13 week period, the employee can give their employer written notice that they intend to claim a redundancy payment. Following this, employers have 7 days to either accept the redundancy claim or provide a written counter – notice.

What is a counter-notice?

A counter-notice signifies that work is expected to be available again soon. This work must start within 4 weeks and last for at least 13 weeks. If circumstances change following a counter- notice, it must be withdrawn in writing. If an employer does not issue a counter-notice within 7 days to the employee, it is assumed that the redundancy claim has been accepted.

Redundancy

Redundancy arises when an employee is dismissed due to:

• Full business closure;
• Workplace closure (closure of one of several sites or relocation to a new site); or
• Diminished requirements of a particular kind of work

How to conduct the redundancy process

Where employers seek to make 20 or more employees redundant they should follow Collective Redundancy rules and should seek advice on how to follow the correct process. However, the steps below should be followed when making less than 20 employees redundant.

When commencing a redundancy process, an employer should firstly hold a group meeting with all employees who are at risk of redundancy. During this meeting, an employer should explain the reasons for any potential redundancies, outlining the number of possible jobs at risk. Whilst informing employees that redundancies are only a possibility at this stage, employers must outline any avoidance methods being explored. Furthermore, employers should ask employees for their suggestions as to how to avoid redundancies and also request volunteers for redundancy. Employers should remain transparent with their employees regarding selection pools and the criteria being used to determine who may be selected for redundancy. Such information should be reaffirmed in writing to the employees and ‘at risk’ letters must be sent to employees being considered for redundancy.

How to ensure a fair redundancy process

To ensure a fair redundancy, an appropriate pool of employees must be identified for redundancy selection. There are no fixed rules determining how the pool should be defined, but the employer’s choice of pool must be within the range of reasonable responses. When selecting a pool of employees for redundancy, employers must consider:

• There is no legal requirement that a pool should be limited to employees doing similar work
• Alternative vacancies on a group wide basis
• The number of employees at risk
• The time frame for the process
• If an employee unreasonably rejects an offer of suitable alternative employment they will forfeit their right to a redundancy payment
• Each employee at risk of redundancy should be scored using a clear selection criteria and scoring guidelines.

Next steps

Employers should conduct individual consultations with the employees facing redundancy, and remind employees of their right to be accompanied by a trade union representative or colleague. A notice of redundancy must be subsequently issued and an employee will have the right to appeal this decision. If an appeal hearing takes place, the employee sustains the right to be accompanied.

Should you require advice or assistance in relation to any of the above please get in touch with Jan Cunningham, David Mitchell or Niamh McMonagle in our Employment Team.