In our October 2017 First Tuesday Q&A, we discussed the three golden rules for employers to follow in conducting a "fair" redundancy process:

1. ensure a genuine redundancy situation exists;
2. ensure the employee was fairly selected for redundancy; and
3. ensure the dismissal was effected with regard to full and fair procedures.

In this month's First Tuesday Q&A, Audrey Whyte, Solicitor in A&L Goodbody, looks at common procedural questions and pitfalls that employers face when navigating the redundancy process.

1. What duration is "reasonable" for an individual redundancy consultation process? 
2. Should an employee be informed of all vacancies within the business as part of the consultation process or only vacancies for which they could be regarded as being suitably qualified?
3. What is the role of the colleague/trade union representative who may accompany an "at risk" employee to the redundancy consultation meetings? 
4. Are employees entitled to be accompanied by their legal advisor for the redundancy consultation meetings? 
5. If an employee is re-engaged/rehired after a redundancy will this impact their statutory redundancy entitlement? 
6. If an employee refuses an offer of an alternative role within the business will this affect any statutory redundancy payment to which they may be entitled?  
   
   

Q. What duration is "reasonable" for an individual redundancy consultation process?

Unlike in the case of collective redundancies, there is no statutory obligation on an employer to consult with an employee in an individual redundancy situation. The obligation to consult has instead been implied through the onus on employers to act "reasonably" in affecting any dismissal as provided for under the Unfair Dismissals Act 1977 to 2015.

A recent Adjudication Officer (AO) decision (Internal Sales Specialist v Respondent (ADJ-00013173) emphasises the importance of ensuring a reasonable length consultation period even in circumstances where the business case for the redundancy is clearly justified.  In that case, the AO found the redundancy process was unfair and awarded the equivalent of 5 months' salary as compensation to the employee. The AO was highly critical of the consultation process which, the AO held, had been conducted in a "cold and systematic fashion which met the criteria for redundancy on a technical level but completely failed to deal with the human aspect" of the redundancy process.   Although the consultation process in question was conducted over a week, the AO found the employer acted with "undue haste" in confirming the redundancy.

Ultimately, what constitutes a "reasonable" period of consultation in cases of individual redundancy will depend on the facts of each case. 

Q. Should an employee be informed of all vacancies within the business as part of the consultation process or only vacancies for which they could be regarded as being suitably qualified?

A thorough redundancy consultation process necessarily involves a consideration of whether there are any suitable alternative roles within the business to avoid redundancies. The most risk averse approach is to provide employees with a list of all vacancies within the business. However, depending on the size of the organisation, this may lead to an unnecessarily drawn out consultation process where the employer has to reject numerous applications for vacancies for which the employee is unsuitable.

Where the employer decides to withhold certain "unsuitable" vacancies from an employee whose role is at risk of redundancy, there should be a clear basis for why the employee would be considered unsuitable. If there is a doubt as to whether the employee is suitably qualified for a particular vacancy within the business, it is prudent to inform the employee of the vacancy and assess their suitability if and when they choose to apply for the role.

Q. What is the role of the colleague/trade union representative who may accompany an "at risk" employee to the redundancy consultation meetings?

A key component of a fair redundancy process requires employers to ensure that employees are afforded the opportunity to be accompanied, usually by a trade union representative or colleague, to any consultation meetings. This does not impose a requirement on employers to allow anyone external to the organisation accompany an employee as a support. Employers tend not to allow individuals who are external to the organisation to accompany employees as a support unless there are specific circumstances which would require their presence, for example, to assist the employee in overcoming a language barrier.

There is no statutory guidance on what suitable qualifications such companions should have. However, it should be explained to employees at the outset that these companions are intended to provide support and are not intended to be an advocate on the part of the employee. Employers should be slow to refuse a request to allow an employee to be accompanied by a particular colleague or trade union representative (unless there is a clear conflict in the colleague/union representative acting as a companion). 

Q. Are employees entitled to be accompanied by their legal advisor for the redundancy consultation meetings?

As recently confirmed by the Labour Court in Component Distributors (CD Ireland)  Ltd v Brigid (Beatrice) Burns (UD/17/174 Determination no.UDD1854) a right to legal representation in the redundancy process is the "exception rather than the rule". The employee here argued that failing to give her the option to be legally represented during the redundancy consultation process breached her constitutional right to fair procedures.  The Labour Court distinguished the redundancy situation from a disciplinary process where an employee may be "at risk of considerable personal and reputational damage arising from serious alleged internal employment related allegations". 

Q. If an employee is re-engaged/rehired after a redundancy will this impact their statutory redundancy entitlement?

The Redundancy Payment Acts (the Acts) provide for a general right to a statutory redundancy payment for employees with 2 years or more continuous service. However, the Acts also provide that an employee will be disentitled to a statutory redundancy payment where:

(i)     The employee is offered and takes up continued employment with the employer or an associated company, on the same terms and conditions as their original employment, to commence immediately after the termination of their employment; or

(ii)    The employee is offered and takes up "suitable alternative employment" with the employer or an associated company, on different terms and conditions to their original employment, to commence within 4 weeks of termination of their employment;

Employees will, similarly, be disentitled to statutory redundancy payment in circumstances where they unreasonably refuse the offer of (i) continued employment; or (ii) suitable alternative employment as the case may be.

Q. If an employee refuses an offer of an alternative role within the business will this affect any statutory redundancy payment to which they may be entitled?  

As set out above, the Redundancy Payments legislation provides that an employee will be disentitled from receiving a statutory redundancy entitlement where they have unreasonably refused an offer of alternative employment with their employer or an associated company.

The legislation provides little guidance on what constitutes an "unreasonable refusal".  However, the legislation does provide that where an employee temporarily accepts an offer of employment as described at points (i) or (ii) above, carries out the duties of that employment for no longer than 4 weeks, and then refuses that offer of employment, this, in and of itself, does not necessarily constitute an unreasonable refusal of the alternative employment and the employee may still be entitled to a statutory redundancy payment in such circumstances.

Ultimately, what constitutes an "unreasonable refusal" will depend on the facts of the case. By way of guidance, the courts have held that while the suitability of the offer of alternative employment must be assessed from an objective point of view, the "reasonableness" of an employee's refusal will involve a subjective analysis. This means that the Court will consider the employee's subjective view of the offer of alternative role in determining if a refusal was unreasonable in any given case. The recent decision of the Labour Court in Cinders Limited v Celina Byrne (ILCR Determination no RPD1811) provides an example of this analysis in practice.