The lasting effects of the pandemic, the impact of the cost-of-living crisis and rising inflation are major factors driving the need for organisations to change and adapt.

While businesses are affected in different ways, determining the right shape and size of the workforce remains critical with some employers needing to consider redundancies and restructuring.

To help employers navigate their way through the complexities of making collective redundancies across borders, Julie Holmes of Legal Island discussed this important topic with Jack Balmer, Senior Associate of Lewis Silkin NI and Laura Ensor, Senior Associate of Lewis Silkin ROI.

This webinar will coincide with the launch of the updated Comparative Law table.

To view the updated Comparative Law Table click here.

Link to slides from the webinar: Legal Island LS Collective Redundancy Comparison slides 22 May JW FINAL.pdf

You may also be interested in:  

Comparative Law Table Webinar - Sick Leave Legislation - September 2022

To view the Webinar Recording remember to log in to your Legal Island Employment Law Hub subscription.

 Transcript

Julie: Hello, and welcome to our webinar with Lewis Silkin today on Comparative Employment Law Across Great Britain, Northern Ireland, and the Republic of Ireland.

My name is Julie Holmes and I'm part of the Knowledge Team here at Legal-Island. Unfortunately, Christine couldn't be here this morning, but you can always catch up with her next week and, again, through some of our other events.

So, how is your organisation coping right now, especially on this Monday morning after all those headlines over the weekend? There are factors, such as the cost of living crisis, which have led to a significant increase in restructuring and redundancies across Northern Ireland and Ireland itself. So, as businesses struggle to cope with rising expenses, they often resort to cost-cutting measures, including workforce reductions.

Today, we're delving into the intricacies of redundancy laws across the different jurisdictions to help you avoid pitfalls and make sure that an exercise that is, let's face it, difficult on everyone who is involved is as smooth as possible. So, grab a cuppa, get settled, and have your notepad at the ready.

So, as I said, we'll be comparing the laws in Great Britain, Northern Ireland, and Republic of Ireland and exploring the similarities, differences, and unique aspects of redundancy legislation in each of these jurisdictions.

By examining the legal frameworks governing redundancy in each region, we aim to shed light on the diverse approaches taken to protect employees' rights and ensure a fair and equitable process during times of workforce structuring. And as we all know, those terms like fair and reasonable can sometimes trip us up.

So, Christine, who works at Legal-Island, and the team in Lewis Silkin, as well as Joanna at Lewis Silkin, so big shout out to Joanna as well, they have created a comparative employment law table to help highlight differences and similarities in employment law across the three jurisdictions.

Legal-Island and Lewis Silkin update the table throughout the year and highlight recent developments that you need to be aware of.

You'll find the table on the Legal-Island Hub and we'll also drop a link to the table on the NI and ROI Hubs into the chat. It's a great resource, so I would urge you to take a look at it afterwards and it will help supplement your notes.

I'm delighted to be joined today by two great speakers from the team at Lewis Silkin, and I'm just going to tell you a little bit about them in just a moment.

First of all, I'm just going to let you know that Legal-Island's webinars and podcasts are sponsored by MCS. MCS help people find careers that match their skill sets perfectly, as well as helping employers to build high-performing businesses by connecting them with the most talented candidates in the market. So, if you're interested in finding out more about how MCS can help you, then head to www.mcsgroup.jobs.

Remember to pop any comments that you may have in the question box. We've already had a number of questions come in, so we don't really have much room for those. But if you need clarification on anything that's been covered, we can certainly try and look at that for you.

So, first of all, please join me in welcoming Laura Ensor. Laura is a Senior Associate in the Employment, Immigration and Reward team based in the Dublin office. So, morning, Laura.

Laura: Morning, everyone.

Julie: Laura advises on all aspects of employment law, both contentious and non-contentious, from the commencement of the employment relationship to its termination. She assists clients with drafting contractual documentation, employment policies. She conducts HR processes and handling employment terminations and any subsequent settlement negotiations and employment claims.

We also have with us today Jack Balmer. So, I'd like you to assist me in welcoming Jack. Jack is a Senior Associate in Lewis Silkin's Employment, Immigration and Reward division based in Belfast. So, morning, Jack.

Jack:   Good morning.

Julie: Jack advises local and multinational employers in both the private and public sectors on a wide range of contentious and non-contentious employment matters.

He has extensive experience in supporting clients with complex disciplinary, grievance, absence and performance management processes, TUPE, SPC matters, business reorganisations, data protection compliance, and their contractual and statutory obligations. He has particular expertise in advising clients on the differing requirements between GB and NI, including fair employment monitoring.

So, I'm going to hand over to the two of them and leave you in their capable hands. Remember to add any comments you have in the chat and I'll re-join you in just a little while. Okay. So, over to you, Laura and Jack.

Laura: Thank you, Julie. So, firstly, we're going to look at the collective redundancy triggers across the jurisdictions, as there are a number of differences. I'll start with the Republic of Ireland position and we'll also look at the impact of the highly anticipated decision in the Debenhams case, which issued last week. And Jack will discuss the Northern Ireland and Great Britain positions.

So, in Ireland, the thresholds for triggering collective redundancy depend on the number of employees normally employed by the establishment, which is different to Northern Ireland and Great Britain, as Jack will outline.

The collective redundancy obligations arise where, within a 30-day period, the employer makes a specified number of employees redundant depending on the size of the workforce. So, 5 or more redundancies in an establishment that normally employs between 21 to 49 employees, 10 or more in an establishment of 50 to 99 employees, 10% or more of the workforce in an establishment of 100 to 299 employees, and 30 or more in an establishment of over 300 employees.

The number of employees normally employed is the average number of employees in the 12 months before the first dismissal takes effect.

Then on the definition of establishment, the Irish legislation defines this as a company or a subsidiary company which can independently effect redundancies.

But this is not in line with the EU case law, which says that establishment means the local unit or entity to which workers are assigned to carry out their duties, and that it must be relatively permanent and stable but does not need to have independent management who can decide to dismiss staff or be economically or administratively separate. And so the EU position should be followed.

On fixed-term employees then, they should be included in the number of employees normally employed by the organisation, but the termination of a fixed-term contract by reason of the expiry of the term does not count as a redundancy for the purposes of the thresholds. If the fixed-term contract is terminated before the end of the term, then it would be counted.

And just to note also that voluntary redundancies would also be included in the thresholds.

Then, when the duty to consult arises, the Irish legislation provides that where an employer proposes to create collective redundancies, it must initiate consultations with employees' representatives. And consultation must be initiated at the earliest opportunity and, in any event, at least 30 days before the first notice of dismissal is given.

So, as I mentioned, the WRC issued a decision in the Debenhams test case last week, which gives some guidance on this point. The WRC said that the consultation process must begin when a strategic or economic decision is made. That means it is intended or contemplated that collective redundancies will take place. And this is regardless of whether the decision is made by a parent company.

In the Debenhams case, the consultation process began on 17 April when the liquidators were appointed. But the WRC said that it should have begun on 9 April when the decision was made by the UK parent company that it was no longer in a position to fund the Irish operations, and the Irish entity made the decision that it was going to appoint liquidators and informed staff that the stores would be closing.

The WRC said that because of this two-week delay, there were less options available to reduce the number of redundancies and to mitigate the consequences of the redundancies.

The WRC said that Debenhams had failed to comply with its consultation obligations, and the WRC ordered four weeks' pay to the complainant for this breach, which was the maximum it could have awarded.

This decision shows the importance of starting consultation as early as possible after a decision is made. That means that collective redundancies are contemplated and it's not sufficient to simply commence the process 30 days prior to the dismissal being effected.

The WRC also said that not having all of the relevant information to hand is not a reason to delay the commencement of the consultation.

And now hand over to Jack, who will bring you through the Northern Ireland and Great Britain position and how this differs.

Jack:   Thanks, Laura. And thankfully, the UK courts didn't turn up any last-minute cases for me.

So, as in Ireland, collective obligations in the UK are triggered once you have proposals that are likely to result in dismissals. The first major difference is the number of dismissals that are necessary to trigger your collective obligations.

So, in the UK, we have a simpler threshold of 20 or more employees who are employed at one establishment. And this time, we have a longer, rolling 90-day period.

And that rolling 90-day period is important. It's based on the ECJ's decision in Marclean in 2020, which we don't really have time to get into here. But the key point is that employers may need to look both backwards as well as forwards when counting the number of dismissals that count towards the threshold.

And the prudent approach, then, is to count all dismissals within a rolling 90-day period and not just looking forward to those that have been proposed.

We do like to be slightly different in Northern Ireland. So, when deciding if you hit that 20-plus threshold, you must include any employees who have been dismissed on the agreed expiry date of fixed-term contracts.

In both NI and GB, you should also include any proposed voluntary redundancies, even if their voluntary termination occurs before the employees who you have to bring through your consultation process.

Can we have the next slide, please?

Laura: I think it's one slide ahead there.

Jack:   Yeah. It should be representatives. Yeah, perfect. So, now that we know that the collective process applies, the next step is to inform and consult with the appropriate representatives of the affected employees.

An affected employee is anyone who may be affected by the proposed dismissals or the measures that you take in connection with them. Helpfully, there is no statutory definition in GB or NI of what measures taken in connection with a dismissal mean, but we interpret this phrase quite broadly in the same way as you would think about measures in the context of a TUPE transfer.

There are three types of appropriate representatives. The first is trade union reps, so long as they are recognised for the affected group of employees. If they are, then you must use them.

If there is no recognised union, the second option is to use existing employee representatives who were appointed or elected for something else, but they've been given authority by the affected employees to inform and consult with these specific purposes.

The third option, then, is to use representatives who have been specifically elected. The employer chooses whether different classes of employees maybe will be represented together or if you'll put your employees into separate groups.

The employer decides how many representatives are needed overall and must take reasonable steps to ensure a fair election process. And those representatives that you elect must be chosen from the affected employees.

And obviously, if you need to elect representatives, you can't begin consultation until after they have been elected.

It's just worth remembering that if the union is only recognised for some, but not all, of the affected employees, the others will still need different representation.

And I will pass you back to Laura now for the next slide.

Laura: Sorry. We'll actually stick with the previous slide just with the representatives. In Ireland, the requirement is also to consult with employees' representatives. And similar to what Jack has said, this will be a trade union, staff association, or a body that conducts collective bargaining negotiations on behalf of employees if they are in place. If there are none in place, then the employees must be allowed to appoint representatives from amongst their number.

And in Ireland, there is no legally prescribed process for selecting employee representatives, and the approach taken is at the employer's discretion. For whatever approach the employer does take, it must make sure to document this approach.

So, then if I could have the next slide.

We're moving on now to what information should be provided and what the consultation should be about. As you can see from the slide, the position is quite similar across the jurisdictions.

In Ireland, the reps must be given certain information in writing, as set out in the slide. So, firstly, the reasons for the proposed redundancies. And this is important to show a genuine situation if a redundancy exists. So, for example, a business reorganisation. Sufficient information should be given on the reasons to enable employee representatives to make constructive proposals.

And just with all of this information, you need to make sure that the language used is not definitive and doesn't show any predetermination. So, everything is a proposal and you should use words such as "it is envisaged" and "it is anticipated", or say things like "if redundancies are confirmed".

Next, then, is the number and categories of employees whom it is proposed to make redundant. Then you must give the number and categories of employees normally employed and information about the number of agency workers engaged by the business, including where they work and what work they do.

And one point that is different from Great Britain and Northern Ireland is the period over which it is proposed to implement the redundancies. And this can be a rough timeline, at least 30 days from the date of the first consultation meeting is scheduled. And "implement" is generally understood to mean the date notice of dismissal is given rather than the date of dismissal.

Next, then, is the criteria for selection of workers to be made redundant. And this must form part of the consultation with the employee reps. So, you can give proposed criteria in the letter, but be clear that it is subject to consultation. Otherwise, you can say that it will form part of the consultation and the information will be provided at the first consultation meeting.

Finally, then, the method of calculating any enhanced redundancy payment must be included. And at this point, we would usually state that the company will comply with its statutory and other legal obligations to its employees.

And then if an ex-gratia payment has been offered, the proposed method of calculating the payment should be set out. So, for example, four weeks' pay per year of service inclusive of statutory redundancy payment. And I'd recommend saying also that it is subject to the execution of a waiver and release in the company's favour.

In addition, then, to this information, employee representatives must be provided with all relevant information relating to the proposed redundancies.

And this point was also stressed in the Debenhams decision. In that case, the employee reps had sought information relating to things like the profitability of each store, the value and ownership of stock, and landlord lease arrangements.

The WRC said that although an employer doesn't have to provide all information, it must provide all relevant information, and said that the information requested was relevant information, and that not having that information frustrated the reps' capacity to make constructive proposals.

The WRC also said that it's not a defence that the employer is unable to get the information from the parent company.

The WRC awarded the employee four weeks' pay for Debenhams' failure to provide the relevant information. And so the employee was awarded eight weeks' pay in total.

Then consultation must include discussion on the following. So, avoiding the redundancies, reducing the number of redundancies, mitigating the consequences of the redundancies, and the basis on which it will be decided which employees will be made redundant. So, this means that the selection criteria and pools for selection should be part of the consultation process where these apply.

And consultation with employee representatives must be with a view to reaching an agreement. And the Debenhams decision stressed that consultation must be meaningful, which the WRC said was not possible where relevant information was not provided to the reps.

The WRC also noted that there was no evidence of any material change to what was proposed at the outset of the consultation and what was implemented, and found this to mean that it was likely that meaningful consultation did not occur.

Now I'll hand over to Jack.

Jack:   So, the information requirements are almost identical in the UK, so I won't go through them all again. But it's worth noting that employers should give some information on the use of agency workers, and that's their total number, the type of work they're doing, and the part of the business that they work in. And the employer isn't required to detail the period of plans to implement the redundancy dismissals within.

Your collective consultation can impact the fairness of eventual dismissals, meaning that employers may be expected to consult more than the minimum required areas.

In particular, the Employment Appeal Tribunal in GB has said that where there's a recognised union, employers should usually consult with it over their proposed selection criteria, and then on if the union believes the criteria have been properly applied to the affected employees.

There have been a string of cases dealing with how much information an employer needs to give about the business reasons that underpin the proposed redundancies.

And the early cases suggested that an employer doesn't need to go into the reasons behind the proposed redundancies, where thinking about their economic background was the context for the redundancy proposals.

However, this position changed with the UK coal mining case, and it seems clear now that an employer must consult on the business reasons for the proposed redundancies as part of its wider obligation to consult on ways to avoid the redundancies altogether.

And finally then, as in Ireland, consultation must be with a view to reaching agreement between the employer and the affected employees. But there's no obligation to actually reach an agreement on the employer's proposals or on the employees' responses to them.

And I'll pass you back to Laura again for the next slide.

Laura: So, how long should the consultation be? In Ireland, as I mentioned, consultation must be initiated at the earliest opportunity and, in any event, at least 30 days before the first notice of dismissal is given.

And the 30-day period runs from the date of the first consultation meeting with the employee reps. So, if employee reps need to be appointed, this will need to take place before then. So, employers should bear this in mind, as the whole redundancy process will usually take longer than 30 days to include this lead-in time.

There's no hard and fast rule as to the number of collective consultation meetings that must take place. Three would be fairly typical, but you may need to have more if the process is contentious or if there are a lot of unresolved matters.

And just to note as well, there must also be individual consultation. And this can take place within the 30-day period, although it's recommended to complete the collective consultation on all substantive points before this is initiated.

Do the authorities need to be notified? Yes. In Ireland, there's an obligation to notify the Minister of Enterprise, Trade and Employment of the proposed redundancies at least 30 days before the first notice of redundancy is issued.

The 30-day information and consultation process with the employee representatives and the 30-day period for notification to the Minister can run concurrently. And a copy of the notice to the Minister must be given to the reps, and vice versa.

I'll run through the information to be provided to the Minister when I get to the next slide.

Are there any exceptions? Yes. Where collective redundancies are triggered by insolvency, there is an exception to the requirement to notify the Minister unless the Minister requests. However, the government has announced plans to remove this exception.

Now I'll hand it back over to Jack.

Jack:   So, the 30-day minimum period holds true in GB and NI as well, unless you're making 100 or more redundancies. In these circumstances, the minimum increases to 45 days in GB, or still 90 days in NI.

If your redundancy exercise is across two or three of the jurisdictions, this can be one of the fundamental differences, which can make harmonising your process impractical or simply a lot longer.

The minimum period runs from the start of consultation until the date that the first dismissal takes effect. So, you can potentially give notice of dismissal during that time period, but in practice, it's not likely that your collective consultation and then your individual consultation will be completed early enough to allow you to actually do this.

These are, obviously, the minimum statutory timeframes. And the overriding principle is that consultation needs to begin in good time before the redundancies take effect.

So, there is the potential that a longer period may be necessary for the employer to consult on everything that it needs to, although there actually aren't any reported cases in GB or NI in which an employer has complied with the statutory minimum requirements and then been found to breach its obligation.

There are some local variations between the GB and NI authorities in terms of who you need to actually inform. You need to make sure you're submitting the correct form within the correct timeframe. And again, we can see there will be a much earlier notification requirement in Northern Ireland of 90 days if you're proposing 100 or more redundancies.

Late or no notification is an offence which carries a fine in both jurisdictions, and it's actually an unlimited fine in GB.

There is a limited exception to the duty to consult if there are special circumstances that mean it isn't reasonably practicable. But unsurprisingly, this is very narrowly interpreted and is very rarely successful.

Special circumstances generally involve some sort of sudden disaster, a physical disaster or a financial disaster. It usually involves insolvency, but even then it still needs to be something quite extraordinary.

To take a recent and high-profile example, the compulsory liquidation of Carillion after their unexpected financial issues and the government's refusal to provide them with any financial support still wasn't considered a special circumstance by the Employment Appeal Tribunal in GB in 2021.

Next slide, please.

Laura: So, as you can see from this slide, the information to be provided to the Minister in Ireland is similar to the information to be provided to the employee reps, with some differences such as the name and address of the company and the type of company. The name and addresses of the employee reps and the company address rather than personal addresses can be given for this, and that's a question we get quite often. And the details of the consultations. So, when they commenced, were due to commence, and where they are currently at.

Over to you, Jack.

Jack:   So, both NI and GB use a different form, helpfully both called HR1. They are very, very similar, but they're not identical. And you obviously do still need to use the correct one. You can tell if you have the Northern Irish form because it asks you to confirm your total workforce in Northern Ireland.

The information that you are required to give is pretty consistent between all three jurisdictions. And again, without repeating everything, you are really providing the key details, the reasons for the potential redundancies, the total number, the types of role affected, and when you think the dismissals will take place.

And I will hand you back to Laura now for redundancy payments.

Laura: Yeah. So, if I can have the next slide, please. So, on notice pay, employees are entitled to their contractual notice, which can be paid in lieu if their contract applies to this or they agree to it. If the minimum notice set out by statute is higher than the contractual notice, then they are entitled to the higher notice.

In Ireland, we have a slight brick in our legislation where employees with over two years' service are also entitled to two-week statutory notice of redundancy. And this can run concurrently with their contractual notice, but technically it cannot be paid in lieu.

So, the safest approach is for employees to be placed on guard in lieu for two weeks or to work two weeks of their notice period, and then be paid in lieu of the remainder. Obviously, that is assuming the employee's preference is to pay in lieu.

However, many employers do take a risk on this and pay in lieu of the full notice period, particularly where an employee is signing a severance agreement waiving all claims against the company. We haven't seen this give rise to an issue.

So, on statutory redundancy pay, employees in Ireland with two years' service are entitled to a statutory redundancy payment, which is calculated as two weeks' pay per year of service, and service is pro rated, plus an extra bonus week, and a week's pay is capped at €600.

Then just on the tax exemptions, statutory redundancy payments are made tax-free and tax reliefs also apply to ex-gratia payments up to certain amounts and subject to certain conditions being met.

I will pass back over to Jack.

Jack:   So, employees in NI and GB must receive their statutory or contractual notice, whichever is greater of those, or an equivalent payment in lieu. Unlike in Ireland, employees can be paid in lieu of their entire statutory notice period, but like in Ireland, your eligibility for statutory redundancy pay kicks in after two years' continuous employment.

However, our payments are calculated differently and increase based on the employee's age and their length of service at dismissal. So, employees receive half a week's pay for each full year that they work while aged under 22, a week's pay for each year aged between 22 and 41, and then 1.5 weeks' pay for each year aged above 41, and their length of service is capped at 20 years.

The overall cap on a week's pay for this calculation is similar, but it is slightly higher in GB and NI than in Ireland. It is currently capped at £643 in GB and £669 in NI, meaning that your current maximum payment is just over £19,000 in GB or just over £20,000 in Northern Ireland.

There really isn't any excuse for getting these calculations wrong anymore. The UK government has an excellent free online calculator that will give you both sets of figures, so you don't need to do any maths.

Your redundancy payment, including the statutory element and any contractual or discretionary enhanced payment, can be made tax-free up to £30,000.

And back to Laura and the next slide.

Laura: So, now the cost of getting it wrong. In Ireland, an employer who fails to comply with its information or consultational obligations or fails to notify the Minister may be found guilty of an offence and liable on summary reconviction to a fine of up to €5,000.

In addition, as we saw in the Debenhams case, an employee can bring a claim to the WRC for failure to inform and consult with employee reps and the WRC can award up to four weeks' pay for the failure to inform and four weeks' pay for the failure to consult. And that's per employee.

Then if notice of dismissal is given to employees before 30 days has elapsed since the date of notification to the Minister, the employer may be liable for a fine of up to €250,000.

However, the risk of a fine in practice is low and this currently doesn't apply in an insolvency situation, but as I mentioned, there are plans to remove this exception.

In addition, an employee could take an unfair dismissal claim to the WRC where the redundancy is not genuine, or where their selection for redundancy was unfair, or where a fair process was not followed. And this is why it's important to also individually consult with employees.

The service requirement for unfair dismissal in Ireland is one year, and that's subject to some exceptions, such as where dismissal is connected to pregnancy, trade union membership, or raising a protected disclosure.

Maximum awards for unfair dismissal are up to two years' gross pay and benefits, and that's based on actual loss, and there is a duty to mitigate losses.

The WRC can also award reinstatement and re-engagement, but these awards are rare in practice.

There are also Industrial Relations avenues to challenge the process. The representatives could refer an issue to the conciliation service of the WRC, but the employer has to agree to participate in conciliation. In conciliation, Industrial Relations officers would assist the parties in coming to an agreement.

They could also take a trade dispute claim under Industrial Relations legislation, but any recommendation would not be legally binding on the parties.

And it's also very important to always be mindful of any reputational risk, as these types of claims often receive a lot of media attention. And as we're aware, collective redundancies are a hot topic at the moment.

So, over to Jack now for the penalties in Northern Ireland and Great Britain.

Jack:   So, the position is the same in NI and GB, in that employers who fail to comply with their obligation to inform and consult are exposed to a specific claim for failure to inform and consult. And this can result in protective awards of up to 90 days' pay per affected employee. This is their actual gross pay instead of their capped weekly pay for statutory redundancy purposes.

The protective award is designed to punish the employer's behaviour, so it doesn't matter if the failure to consult has actually made any difference to the eventual outcome of the process.

If there hasn't been any consultation at all, the tribunal will start at the 90-day maximum, and it will then only reduce the protective award if the employer can show mitigating circumstances.

There is a circumstance that even if the employer has observed the full minimum consultation period, there is still the risk of substantial protective awards if it breaches its other statutory obligations in terms of the scope and the extent of the consultation process.

So, for example, if the employer's final decision to make redundancies has actually already been made by the time the consultation begins, there is still the likelihood of substantial protective awards because the employer's actions mean that consultation has, in effect, been limited to mitigating the consequences of the dismissals rather than covering ways to avoid actually making them in the first place.

This does sometimes suggest an all-or-nothing approach to consultation because an employer who gives the full amount of time for consultation, but then carves out a defective consultation process, could be left with both their normal payroll costs for the 30- to 90-day consultation period plus up to 90 days' protective awards per employee.

In contrast, an employer who simply ignores their obligations and dismisses employees immediately by making a PILON and giving a redundancy payment will obviously be liable for a full protective award of 90 days' pay. However, they will have saved between 30 and 90 days' payroll costs, which they would have incurred if they'd carried out the full consultation process.

However, actually taking this approach can have disastrous consequences for Industrial Relations, especially when a union is recognised. It can naturally lead to widespread negative media coverage. And I think we could all name a certain ferry company when we're thinking about that.

Collective consultation doesn't remove the need for individual consultation with employees. In Northern Ireland, the statutory dismissal procedure still applies, so employers must ensure they discharge the three-step process, as well as the collective process, to safeguard against unfair dismissal claims.

Crucially, this means offering the right to appeal, without which the dismissal will be automatically unfair on procedural grounds.

In terms of unfair dismissal awards, a successful claimant won't be entitled to a basic award from the tribunal if they've received a statutory redundancy payment. But they may still receive substantial compensatory awards for loss of income as a result of their dismissal.

In GB, the compensatory award is capped at the higher of one year's gross pay or just over £105,000. In NI, there is a straight cap of, again, just over £105,000, but it's slightly higher. So, we can see that there are material cost implications if the employer doesn't carry out individual consultation.

And back to Laura then for the final slide.

Laura: So, can you settle collective redundancy claims? So, yes, in Ireland it is possible to settle collective redundancy and unfair dismissal claims in a severance agreement, but there is still a risk of criminal liability, although, as I mentioned, the risk of criminal sanctions in practice is low.

In Ireland, there is no requirement for an advisory certificate to be signed and appended to the severance agreement, but we recommend that employees are required to take legal advice and that a contribution towards the legal fees is offered so that there is no question over the enforceability of the agreement, and the employee cannot turn around in the future and say they didn't know what they were signing.

Then an unfair dismissal claim, the service requirement is one year in Ireland, as I mentioned, with some exceptions. And this would include the employee's actual service plus their contractual notice period, which would be added on.

There is no statutory requirement to offer an appeal in Ireland, but it is recommended, as a number of WRC decisions have found that dismissal on grounds of redundancy was unfair where an appeal was not offered and said that an appeal was part of a fair redundancy process.

Then just in terms of guidance, there is no official guidance for employers on redundancy situations in Ireland. The government has published an Information Handbook for employees on their rights and remedies in a collective redundancy situation. And it's helpful for an employer to review this, as it's usually what the employees will likely read when going through the process.

I will hand back over to Jack, then.

Jack:   So, you can settle collective redundancy claims in both GB and NI, but it's always worth remembering that you can't settle a complaint for failure to comply with the statutory requirements on informing and consulting with appropriate representatives by using a settlement or a compromise agreement. These claims can only be settled through conciliation, whether that's through ACAS or through the Labour Relations Agency in Northern Ireland.

You can, however, settle any claim for failure to pay a protective reward by using a settlement or a compromise agreement. When we're talking about compromise or settlement agreements, it's a difference in terminology between GB and NI. There is no sort of real difference between them.

One major difference in the technical requirements between Ireland, GB, and NI is that in the UK your compromise or settlement agreement must be signed off by a relevant legal adviser. It's quite often a solicitor, but it can be a trade union official. I've had circumstances where it has been a barrister, for example, as well.

So, in terms of unfair dismissal rights, employees in Ireland and Northern Ireland both need the same level of qualifying service, one year, and that was increased to two years in GB.

For the purpose of bringing an unfair dismissal claim, an employee can essentially add their statutory minimum notice under their actual service. So, for example, in Northern Ireland, if you dismiss someone at 51 weeks' employment, they can tack on their one-week statutory notice and then they will be eligible to bring an unfair dismissal claim. So it's always worth keeping that in mind.

When we're thinking about unfair dismissal, we've discussed that you need to offer the right to appeal. Like in Ireland, it is not a legal requirement in GB, but it's still recommended to demonstrate a fair procedure.

Just briefly then, when you're looking for guidance material, just remember the local variances. So, in NI, the primary source is the LRA's guide on handling redundancies, where in GB it is the ACAS guidance.

These both contain a lot of general best practice guidance that is cross-applicable, but they do differ in certain areas, especially, again, on the right to appeal. So, it's just worth keeping in mind.

And of course, you already know about the fantastic comparative table that we have prepared for Legal-Island, so it would be remiss of me not to remind us all of that.

One final difference between GB and NI is in the context of a TUPE transfer. In GB, the incoming employer can carry out collective consultation with transferring employees before the transfer date. This was part of the package of TUPE reforms introduced in 2014 in GB. These weren't copied in Northern Ireland, meaning that the incoming employer needs to wait until after the TUPE transfer before it can start the consultation process.

And that is everything from Laura and I. So, thank you for joining us this morning. I think we have time for some questions now.

Julie: That's great. Thank you very much, Laura and Jack. That was great. And as you say, Jack, that table format just makes it so clear to understand as you were going through the points.

And can I just reassure everybody that is watching us today that, yes, the recording will be available, the slides will be available, and Maria has already dropped the links in for the updated table. So, all of that information will be available to you.

Laura and Jack, a couple of questions for you. As I said, that is a popular topic, so lots of chat coming through. So, first of all, can you make an employee on maternity leave redundant?

Jack:   Will I go first for NI?

Julie: Sure, Jack. Thanks.

Jack:   So, in NI and GB, the simple answer is yes, employees on maternity leave can be made redundant, but before that can happen they must be given priority over other employees who are at risk for any suitable alternative employment opportunities.

It's worth keeping an eye on the situation in GB because this may be changing. The Protection from Redundancy (Pregnancy and Family Leave) Bill is making its way through Parliament at the moment, and this would extend that priority status to employees who are pregnant, who have given birth within 18 months, and it will also extend protection for adoption and shared parental leave.

The bill isn't a government bill, but it is widely supported and it's expected to pass. Once the bill has passed, we would need enacting regulations. They are likely in around 2024.

As is often the case, we obviously don't have the capacity to pass a similar bill or regulations in Northern Ireland, as nice as that would be. But with legislation like this, which provides substantive rights for a large group of people, we would anticipate there would be a lot of pressure to pass legislation centrally. So, it may come through in Northern Ireland as well, but it's very much wait and see.

Julie: Thanks, Jack. And Laura?

Laura: Yeah. So in Ireland, differently, I guess, the answer is no. So, any notice that is issued to a person on maternity or paternity leave or adoptive leave will be void. And so you can't serve notice of termination due to redundancy or for any other reason on a person who is on one of these leaves.

However, you should still include them in the consultation process, and these employees should be kept informed of the position. They should receive the same information as other employees, and they should be given the opportunity to actively participate in the consultation process.

There is also obviously always a risk that they won't want to participate, and then they should just be kept informed, and the employer will need to consult with them on their return from leave.

And like what Jack said, there is no statutory requirement in Ireland to give individuals on maternity leave priority for redeployment in a redundancy process. Those employees have the same entitlement to redeployment opportunities as other employees, but with these employees, as always, you should be mindful of any discrimination risks.

Julie: Okay. That's great, Laura. Thank you. That's a great summary. And then can you tell us about whether you have to consult about selection criteria? So, Jack, start off with you again.

Jack:   So, I think we've touched on it slightly. Employers must provide information to representatives on the method that they've used to select employees for dismissal. But in terms of actually consulting on the selection criteria that you propose to use, this can be relevant to whether the individual dismissals are fair or unfair.

And again, if there is a recognised union, it is best practice for the employer to consult with the union on the selection criteria that it proposes to use. If the union believe, then, that the criteria have actually been properly applied as you go through the process . . . And it's not a hard requirement, but you can imagine, obviously, if there is union involvement, it's really in everyone's best interest for you to bring them into that discussion about the criteria that you're going to use and how you've applied them.

Julie: Thanks for that. And Laura?

Laura: Yeah. For Ireland, you are legally required to consult about selection criteria. As part of the collective consultation process, the rep should be given information about the pools for selection and the selection criteria.

The selection criteria should be fair and objective and should not be based on any discriminatory grounds, nor should they be based on one person's subjective opinion. And just as a rule of thumb, we would use the selection criteria to focus on the skills, knowledge, and experience required for the role that's been retained.

And once the selection criteria is agreed, it's applied and the employees who are provisionally selected for redundancy will be informed that they're at risk of redundancy. And then at the individual consultation stage, employees should be provided with their scores against the selection criteria and given the opportunity to comment.

And in Ireland, we have quite a high standard in terms of our procedures, so employees should really be provided with anonymised scoring for other employees in their pool. But from experience, we have seen that a lot of employers don't want to do this and will only provide the cut-off score at which they wouldn't have been selected, especially in terms of smaller pools where individuals could be identified.

Julie: Great. Thanks very much, Laura. So, Jack, are there any proposed developments on collective redundancies?

Jack:   I mean, obviously, we've just briefly covered the changes in terms of maternity and sort of expanding that to pregnant employees and people returning from maternity leave. That's a pretty major change, we would say, in Northern Ireland.

I mean, as in all things in Northern Ireland, we await further news from on high. I think if I was able to tell you if there are going to be any changes, then I would be in Stormont right now and not here.

Julie: Okay. Thanks very much, Jack. And then Laura, same question.

Laura: So, I kind of touched on this while going through the slides, but basically, in Ireland, in 2021, the government issued a plan of action for collective redundancies in insolvency situations, and that set out the government's commitment to enhance protections and ensure transparency for employees in such situations.

And then earlier this month, the government issued a heads of the general scheme on this, and the general scheme proposes a number of changes to the collective redundancy legislation.

So, the exception for notification to the Minister where the employer is insolvent will be removed, and insolvent businesses will also be subject to the restriction that redundancies cannot be affected until 30 days have elapsed since the date of notification to the Minister. And the same fines will also apply for non-compliance.

Employees will also be able to bring a claim to the WRC where the employer makes them redundant before the 30-day notification period finishes. And this will apply in any situation, so including an insolvency situation.

And this could also give rise to an award for up to four weeks' remuneration. So, basically, what that means is if the employer fails to comply with its notification and consultation obligations, in addition to affecting redundancies before the 30 days have elapsed, it could be required to pay up to 12 weeks' pay in compensation per employee.

Then the employer's obligations will also need to be complied with by a liquidator, and the liquidator will be required to continue any process that was commenced by the employer, which is, basically, what was held in the Debenhams decision as well. And there will also be measures to improve the quality and circulation of the information to workers.

Julie: Great. Thank you. And then when we talk about redundancy pay, is there a requirement to pay an enhanced redundancy payment? And what would be standard?

Laura: Yeah, I can . . .

Jack:   Well . . . Oh, will I go first?

Laura: Yeah.

Jack:   There's no requirement to make an enhanced payment, and that was, obviously, subject to if you have contractual redundancy terms somewhere. That will really vary industry by industry. It's probably more common in sort of industrial or manufacturing-type environments, but we're obviously in the public sector. If you do have contractual redundancy payment schemes, then you do need to follow them. You can get into all sorts of bother with the unions if you don't. But outside of that, no, the statutory scheme is the requirement.

In terms of what is common, usually you will see something based on years of service and possibly providing a capped amount of salary per year or per month based on the length of service that you've accrued at the date of dismissal.

Julie: You had mentioned that calculator as well, Jack, which, as you say, is very handy and does it all for you. And then, Laura, same question about enhanced redundancy payment or standard in Ireland.

Laura: Yeah. So, the position is similar in Ireland. There's no requirement to pay anything above statutory redundancy unless, as Jack said, there's a contractual entitlement, and that can be applied through a custom and practice within the company.

But in Ireland, it's common to pay an enhanced redundancy in return for the employee signing a waiver of claims. And it's also helpful to pay it because it assists with a smooth exit of employees and can achieve full and final settlement of all claims.

It also assists with maintaining goodwill of employees who have been retained if they see that their colleagues were looked after. And employees in Ireland would generally have an expectation to receive something in addition to their statutory entitlement. And so the process is likely to be more contentious where this isn't offered.

Similar to what Jack said, there's a number of different ways of calculating this. And the most common is a number of weeks' pay per year of service. It can be exclusive of statutory, and then usually would be subject to a cap of, for example, a year's salary. And that standard would depend on the industry, but would usually range from something like two to six weeks' pay per year of service, inclusive of statutory.

In the recent tech redundancies that we've seen in Ireland, most of the companies have offered quite generous minimum payments. So, for example, three to five months' pay regardless of an employee's service, and then a smaller variable payment per year of service after that.

And employers will also usually offer outplacement services and then a contribution towards the legal fees in obtaining advice in relation to the agreement. Approximately €500 is usually standard in that.

Julie: That's great. Thank you. And then just to finish off, I think we can squeeze in one more question. So, Jack, this question is specifically for you because it's talking about a company that's based in Northern Ireland with a redundancy situation involving 10 employees who are based in Northern Ireland and then 10 employees who are based in Ireland. So, do you have to collectively consult?

Jack:   Yeah. That's the easy question. So, the basic principle is that employees are subject to the jurisdiction they work in. So, you might be able to just split the employees into those working in NI and those working in Ireland and treat them separately.

In the simplest example, if you have an office in Belfast and an office in Dublin, you can consider each as a separate legal establishment and follow the applicable legal process in each jurisdiction.

If you only have one establishment, for example, if you're based in Fermanagh and you have some employees working there, but you have another group of employees who actually work in Ireland, you should still be able to split them up.

So, if you're making 5 redundancies from employees in NI and 10 from the employees who work for you in Ireland, you would only trigger your collective obligations in Ireland for those employees who actually work in Ireland.

If you have a group of employees in both jurisdictions who actually have all Ireland rules, it's a bit trickier because you can't legally separate them and you might need to apply an all-Ireland establishment to them, and then ensure essentially that you meet your collective obligations in both jurisdictions.

And in practice, many employers actually choose to use cross-border establishments so that they can follow a single, harmonised process so that they can pull cross-border teams together and retain the best employees from those teams.

If you do want to harmonise your process in NI and ROI, you need to ensure that you're working to the higher standard required at each stage of your process.

So, for example, if you're proposing to dismiss 50 employees in Ireland and 50 in Northern Ireland, you're triggering a 30-day consultation period if you treat both of those as separate legal establishments, one in Ireland and one in NI.

But if you treat them as one consolidated legal establishment, you've hit 100 employees, and if we're following the higher process, you actually need to give 90 days' consultation so that you're complying with the higher requirement under NI law.

Another alternative is to have separate legal establishments in each jurisdiction, but then apply a harmonised process. And again, you just need to follow the higher standard.

So, if we go back to the first example where you have an office in Belfast and an office in Dublin, you could treat each as separate legal establishments, but then provide the same consultation period, same process, and the same payments in each, just so long as you're always complying with the higher standard and taking account of any local quirks. And that would include, for example, the need to have a legal adviser to sign off on a compromise agreement in Northern Ireland but not in Ireland.

Julie: That's great, Jack. Thank you, because that was a bit of a loaded question but you handled it beautifully, I have to say.

All right. So, thank you very much to both Jack and Laura for going through what is usually a very complex area. That was a great webinar. And as I said, the resources will be available, the recording will be available, and those slides as well.

And again, now you've kind of met Jack and Laura virtually, so you can always get in touch with them via LinkedIn or through the Lewis Silkin offices as well.

So, on that note, has that whet your appetite to refresh your knowledge on key areas of employment law? We have an Essentials of Employment Law online course, and they're specifically designed to give attendees a thorough grounding in the main components of employment law.

With so many changes taking place in today's workplaces, including hybrid and remote working, an understanding of core employment law is now more important than ever.

So, you can join us for these interactive two half-day online events delivered by a team of highly experienced employment law experts. Sessions will be supported by a comprehensive pack of notes, as well as a number of practical exercises throughout the sessions to help you enforce your learning.

So, in Northern Ireland it's 20 June that the course starts, and in ROI it's 13 June. You'll be able to find out more information in the chat and on our website as well.

So, thank you very much, everybody, for attending today. Jack and Laura, thank you for a very informative session and for making a complex topic that bit more understandable too. Thanks very much.

Sponsored by: