After being extended several times, the furlough scheme is due to finally close at the end of September this year. The government has been encouraging this wind down of the furlough scheme since the beginning of July, when employers had to begin paying 10% of their furloughed workers’ wages. This amount has now risen to 20% as from August. Therefore, the upcoming changes on the last day in September may lead to employers having to consider redundancies and restructuring that they have managed to put off until now. Until recently, most employers have been reluctant to restructure their work force and make redundancies, because of the availability of the furlough scheme as the rescue life line for employees’ jobs.
Restructuring and redundancies can be a difficult process for employers and employees alike, and getting it wrong can have many consequences. Depending on the business circumstances, an employer will want to understand whether their company needs to undergo a restructuring process or whether jobs will need to be made redundant.
When considering restructuring there has to be a credible reason for a restructure. Usually, it is because the same group of people are being employed, but earmarked to do different jobs for different pay. An employer may be looking at adapting the business model with less management and less administration functions, or people could be taking on more duties for the same or less money. Restructuring will always have an impact on the contract of employment and will inevitably require individual two way consultation and sometimes collective consultation with elected employee representatives of unions where the numbers involved are 20+. This can still stray into redundancy though, if the requirements of the business for employees to carry out work of specific kind will cease or diminish and there are no other suitable alternatives jobs at the same company for them to do.
Redundancy, like restructuring, is not about the person, it is about the job that they are doing. There has to be a cessation of diminution in the requirements for them to carry out work of a certain kind. It is vital that employers consult with all employees who could be affected by redundancy, but there are different considerations to factor in depending on how many redundancies they plan to make.
It is also important to remember that employers must not present their redundancy plans as a fait accompli at the start of the consultation process. When selecting employees for redundancy, an employer must be as objectively fair as possible and not discriminate on grounds of a protected characteristics. Instead, it is best practice to base selection criteria on standards or output of work, attendance record and disciplinary record; and above all consult with staff on the criteria.
In a post COVID workplace these questions and decisions become even more difficult to make, therefore it is best to seek help from an expert who can aid employers make well informed decisions and minimise risk. Please get in touch by emailing email@example.com if you need any advice surrounding restructuring and redundancies and how to implement them.