How Do I Keep My Best Employees During a Redundancy Exercise?


Patricia Rooney, writes:


Any redundancy exercise should be carried out fairly and in a transparent manner. The basis of dismissal on the grounds of redundancy is set out in the Employment Rights (NI) Order 1996 (the Order). In dealing with your query, I have assumed there are circumstances which give rise to a valid redundancy situation under the Order and that all alternatives to redundancy have been considered.

The Labour Relations Agency suggest that criteria used in a redundancy exercise should be “unbiased, fair and consistent”. Using more objective criteria in a selection process, make it easier for an employer to justify the selection of a particular employee and defend any claim of unfair dismissal/unfair selection for redundancy and/or discrimination.

You have indicated you wish to keep your best employees. I am not aware of the number of employees at risk of redundancy. As you may know, if there are 20 or more employees at risk of redundancy, the employer’s obligations for a collective redundancy and consultation exercise are triggered. This means you should consult with employee representatives, having arranged for a fair ballot and election of those representatives, if required, and also inform the Department etc.

Part of that consultation exercise would involve an attempt to agree selection criteria. If the number of potential redundancies is less than 20, you must still consult with the employees themselves. The first step would be to look at the Company’s own policies and procedures and ascertain whether there are already arrangements set out for a selection process, any criteria contained in those policies or whether there is a collective agreement with a union in relation to criteria which must be adopted in any redundancy exercise. In the absence of a written policy or a collective agreement, you should also look at previous redundancies to ascertain whether certain criteria might be imposed by way of custom and practice.

In the absence of a collective agreement with the union, or a written policy/procedure on the issue, it would be possible to agree selection criteria with the employee representatives, or employees themselves as appropriate, as part of the consultation exercise. Whilst agreed criteria would not deflect Tribunal claims entirely, their use may at least reduce the risk of claims if you could establish that there had been full discussion and negotiations as to the criteria to be adopted in this redundancy exercise. Of course, the criteria must still be applied in a fair and consistent manner.


In deciding what criteria to use, you may consider the use of strictly objective criteria e.g.

• disciplinary record
• time keeping
• attendance
• service

You should of course be wary if using absence as a criterion alone and avoid consideration of an absence which may have been due to a disability, or an absence due to pregnancy/pregnancy related illness.

It may also be possible for you to include length of service as a criterion in any selection exercise. The case of Rolls-Royce plc v Unite the Union [2009] EWCA Civ 387 has held that it is not unlawful to use length of service, although potentially age discriminatory, in conjunction with other performance measuring criteria in a redundancy exercise. The Court there held that the use of service as a criterion was justifiable, fulfilled the business need and respected the loyalty and experience of the older workforce.


The above are still objective criteria and you may also wish to consider using more performance based criteria:

• Work Performance
• Contribution to team/company
• Versatility/Flexibility
• Qualifications

All criteria should be fairly applied and you could also take into account whether there is an existing appraisal/review process whereby some of the above criteria are already used to assess an employee’s performance/contribution to the business. If so, perhaps use that appraisal/review system as part of the selection process, in addition to the objective criteria of attendance/discipline etc. Of course, should you wish to use the most recent outcome of the appraisal process itself, you should ensure that the appraisal report/outcome was agreed and signed off by the employee concerned to avoid any challenge to the redundancy process on that basis.

In settling the criteria, a Line Manager/Director may be in the best position to identify which abilities/experience/attributes etc. are important to the organisation. Part of that consideration may be to assess how much weighting, if any, is allocated to individual criteria in the selection and scoring process to emphasise that requirement which is most important to the Company’s business needs. Weighting may be a factor used in allowing the Company to retain its most suitable staff.

Once criteria have been identified, and hopefully agreed, you will also need to classify the pool of employees who are at risk of redundancy and to whom the criteria will be applied. Subject to the different roles within the workforce e.g. Technicians/Engineers/Support Staff/Operatives etc you may be able to apply one set of criteria to all pools of employees without changing the criteria in any way. It may be necessary however to adapt the criteria for the particular pool of employees: if, say, you require an engineer to have a particular qualification, you could add that criterion to the pool of engineers only without changing the standard criteria to be applied to all other staff at risk of redundancy.

Having settled on the criteria required and the pool of employees to which it will be applied, the scoring exercise can commence. I would suggest that two people carry out this marking exercise to avoid a claim of discrimination against an individual Line Manager who may carry out the exercise on his/her own. Any records relied upon as part of the scoring procedure should be accurate and up to date e.g. attendance, disciplinary, length of service details etc. together with any appraisal outcome relied upon in this scoring exercise. This will reduce the risk of challenge to the scoring outcome. The employees’ Line Manager together with another Manager, may be best placed to undertake this scoring exercise considering the criteria, the employees’ job description/personnel specification etc. All marks must be fully justified and properly recorded in the scoring matrix.

The employees should of course be advised of their individual scoring and their ranking within the pool of employees at risk of redundancy. Part of the consultation exercise with the individual employees would allow an opportunity to consider and discuss the scoring and of course, to allow the possibility of appeal in the event that their role is declared redundant.

The use of carefully chosen criteria, reflecting the Company’s business and operational needs going forward and an accurate and documented scoring matrix and process, should allow you to retain the employees best suited to meet the organisation’s needs in a difficult economic climate, whilst reducing the risk of challenge to the redundancy exercise itself.