Model Redundancy Agreement and a Fair Process of Selection

This policy has been developed as a result of a joint consultation between the staff (wherever "staff" is used, read as "Staff Association" or "Trade Union" as appropriate) and Management. The policy does not supercede or over-ride individual’s rights under current employment legislation. (Note that under Jersey Law the only statutory right is that a redundant employee should be fairly selected for redundancy and he/she is entitled to receive statutory notice in accordance with the Termination of Employment provisions of the law).

1. STATEMENT OF INTENT

It is the Employer’s intention to develop and expand the business activities of the organisation and in the course of this, provide a secure and stable work environment for its workforce. It will plan its manpower requirements based on the organisation’s objectives and business forecasts and by adjusting recruitment, overtime working and utilizing natural wastage to plan and maintain a stable workforce. However, circumstances may arise due to organisational requirements, changes in the market and health & safety related issues etc. that necessitate a reduction of staffing levels to ensure the economic viability of the organisation. In order to minimise the impact of such reductions, the following procedure will be adopted wherever possible. It must, however, be recognised that where the need of the business so dictates, and after consultation with staff, the procedure would need to be adapted to the particular exceptional circumstances which prevail.

2. SCOPE & APPLICATION

This Policy applies to all employees of the organisation. The employer recognises the need for the interests of the staff to be represented and to this end will inform staff at the earliest possible stage of any potential reduction to its staffing requirements. Informal discussions will follow as to ways of avoiding reductions and addressing any issues arising. Due to commercial sensitivity these discussions may, by necessity, be of a confidential nature. If however, staff reductions seem unavoidable, the employer will commence formal consultation with staff and affected employees, as detailed below. The staff (Staff Association/Trade Union) recognises the employer’s responsibility to plan its use of staffing levels in light of the types of personnel and skills required for the operating needs and continuation of the business.

3. INFORMAL DISCUSSION STAGE - MEASURES THAT CAN BE TAKEN TO AVOID OR MINIMISE REDUNDANCIES

Where the possibility of a reduction in the number of employees arises, Management will enter into discussions with the staff with a view to establishing whether the proposed job losses can be avoided or achieved by means other than by compulsory redundancies. The following actions will be considered as a means of avoiding redundancy.

3.1 Recruitment

In a potential redundancy situation, the employer will ban the recruitment of new permanent staff, other than where this is essential. The employer will seek to recruit from internal candidates, whenever possible. If an internal candidate is unsuccessful, he or she may request feedback from their Manager/Personnel Manager as to why he or she was unsuccessful.

3.2 Sub contractors and Temporary Staff

Should a redundancy situation arise, the employer will restrict the use of subcontractor and temporary staff, including agency workers, other than where this is essential. Where possible, having taken account of the needs of the employer and current legislation, the sub contractors and temporary staff will be replaced by internal permanent staff. Volunteers and/or work experience students will not be used to substitute for permanent staff.

3.3 Overtime Working

The employer will limit overtime working in a potential redundancy situation but will not compromise health and safety and operational requirements. If necessary, operational requirements may be modified to allow for non-overtime working.

3.4 Short Term Problems

Where short term problems are experienced from a fall in demand, enforced closures or any other reason which prevents the employer providing normal work for any or all of its employees, the employer may, after discussion with the staff, ask employees to undertake duties outside of their job descriptions

In exceptional situations, as an alternative to introducing compulsory redundancies, the employer may, after discussion with the staff, ask employees to:

a) Voluntarily take a reduction in wages, or

b) Work extra days without pay, or

c) Consider the introduction of temporary short time working or lay-offs, where their individual contract of employment does not already allow for this.

The employer will also consider applications from individuals who wish to reduce their working week or "job share" for the duration of the prevailing adverse conditions. The terms and conditions under which the job share will operate will be agreed in advance and confirmed in writing.

4. FORMAL CONSULTATION STAGE (incl. formal notification to staff)

4.1 Formal Consultation with the Staff (Staff Association/TU Committee)
When it appears that redundancies are inevitable the employer will formally consult with the staff. The employer will identify departments and pools of jobs at risk and confirm the selection criteria with staff. This will be in accordance with the legislation current at the time of the proposed redundancies. Best practice requires the employer to notify the staff as to the proposed redundancies and consult with the staff, with a view of reaching agreement on:

Ways of avoiding redundancies

Reducing the number of employees to be dismissed, and
Mitigating the consequences of the dismissal

4.2 Measures To Avoid Compulsory Redundancies

(NB the following are not sequential and can operate individually or simultaneously)

4.2.1 Voluntary Redundancies

Should a redundancy situation become inevitable, management will call for volunteers from the affected group of employees. Volunteers from outside the pool of affected employees will be considered. However, management reserves the right not to accept volunteers who have key skills. Whilst management will consult with the staff as to what constitutes "key skills" the final decision will be for management to make.

4.2.2 Voluntary Early Retirement

In a redundancy situation the employer will invite applications for early retirement from all employees. However, the employer reserves the right not to accept volunteers who have key skills. Early retirement will be in accordance with the terms of any relevant pension scheme.

4.2.3 Redeployment

Wherever possible the employer will try to re-deploy staff who are under threat of redundancy into other areas of work. If a vacancy exists, all potentially redundant employees will be asked if they wish to be considered for the post. Those wishing to be considered will be interviewed by the Personnel Manager and relevant line manager to establish individual requirements and to consider the employee’s suitability for the particular post. Unsuccessful candidates will, if they so request, be granted an interview with the Personnel Manager who will explain why they were unsuccessful.

Individuals may be given a trial period in the new post; the length of this trial period will be agreed in advance and will be dependent on training, current legislation etc. During the trial period, assessments will be made as to the individual’s capability. If an individual fails the assessment, or feels unsuitable for the post, he/she will then be made redundant.

4.3 Compulsory Redundancy

If, having taken all of the steps to avoid or minimise redundancies, the number of employees still exceeds the number of people required, the employer will use fair, consistent, objective and non discriminatory methods of selection which will ensure the retention of a balanced workforce, appropriate to the future needs of the business.

To determine which employees will be considered for redundancy the employer will identify a pool of jobs or departments at risk. The employer will consult with staff as to the composition of this pool although the final decision on this issue will be for management to take. From this pool, a selection will be made in accordance with the criteria detailed in Appendix 1. The employer reserves the right to exclude individuals from any selection pool on the grounds that the individual concerned holds key skills that the business needs to retain.

5. INDIVIDUAL EMPLOYEE CONSULTATION

As far as possible in advance of the proposed redundancy date, Management will notify those employees provisionally selected for redundancy. The affected employees will be interviewed personally, informed of the basis of their provisional selection for redundancy and invited to make representations as to why they should not be selected. In effect, this will enable staff provisionally selected to appeal against the decision made. Employees have the right to be accompanied at this interview by a work colleague (Staff Association representative or a trade union representative), if they so wish.

Management will take into full consideration any representations made during the interview, clarifying and exploring any points raised. Only after all reasonable options have been examined and eliminated will the redundancy be confirmed. If information comes to light in the interview to change the basis of selection, an alternative member of staff may then be selected, but will also have the right to make representations as to why they should not be selected.

When selection has been confirmed, those selected for redundancy will be given notice of termination in accordance with their contractual or statutory entitlement, whichever is the greater. In certain circumstances, when it is considered appropriate, payment in lieu of notice may be made.

6. SEVERANCE PAYMENTS

Compensation for loss of employment due to redundancy will be in accordance with statutory requirements current at the time of termination (Other than due notice, there are no statutory provisions for compensation in Jersey Law).

In addition to any statutory payments that may be due, the employer may agree additional payments to those volunteering to be made redundant or those selected for compulsory redundancy. Decisions as to whether or not additional severance payments are made will be decided at the time of any redundancy situation by Management after consultation with the staff (Staff Association/TU). The final decision as to additional severance payments will be for Management to determine. (If the organisation has agreed certain minimum severance payments it may decide to list such payments here).

7. POLICY IMPLEMENTATION AND REVIEW

This policy will be effective from the date of signing. It will be reviewed annually by Management, (in conjunction with the Staff Association/TU), to ensure its currency.

APPENDIX 1

SELECTION CRITERIA

Should it be necessary for the employer to introduce compulsory redundancies, the following selection criteria will be used. (Different or additional criteria may be used but it is strongly recommended that "length of service" and "performance" criteria are included in the selection criteria).Points awarded under the relevant factors as detailed below, will be awarded to each individual within the relevant pool, and a rank order produced. The lowest ranked individuals will be selected first and so on up the rank until the necessary numbers of redundancies are achieved. In the event of an identical points score, length of service will be used as a determining factor, the individual with the shorter service being selected for redundancy.

1. Length of Service

Length of Service will be calculated from the date of commencement of employment and based on continuous service. Points awarded as follows: -

Twenty plus years = 10
More than Ten years but less than Twenty Years = 8
More than Five years but less than Ten years = 6
More than Two years but less than Five years = 4
One year but less than Two years = 2
Less than One year = 0

Continuous service will be determined in accordance with current employment legislation.

2. Disciplinary Record

Any disciplinary warning on record will contain a stated time limit for its duration, e.g. 3, 6 or 12 months. Points will be awarded on the basis of formal warnings that are current during the preceding twelve months of the Redundancy Exercise. Warnings issued under the disciplinary procedure for poor attendance will be excluded from this section so as to avoid double counting with the Attendance criteria. The points will be awarded as follows: -

No current warnings on record = 5
Verbal warning current or on record in preceding 12 months = 3
Written warning current or on record in preceding 12 months = 1
Final written warning current or on record in preceding 12 months = 0

3. Attendance Records

The selection criteria for attendance will be based on the employer’s records of absence over the preceding two years. "Absence" relates to sickness absence or unauthorised absence. It does not relate to absence on company business, holidays, special leave, or in relation to statutory duties e.g. jury service etc. Points will be awarded on the basis of the number of occasions a person has been absent and the number of days they have been absent the points scored will then be divided by two. Absences for pregnancy related issues will be discounted. Properly recorded accidents at work will also be discounted.

Occasions

No absences or up to Two Occasions = 5
Three or Four Occasions = 4
Five or Six Occasions = 3
Seven or Eight Occasions = 2
Nine or More Occasions = 0

Days

No absences or up to Five Days = 5
Six to Ten Days Absence = 4
Eleven to Fifteen Days Absence = 3
Sixteen to Twenty Five-day Absence = 2
Twenty Six Days or more = 0

Performance

Performance will be determined through the jointly agreed appraisal scheme.

In the absence of such a scheme, performance criteria will be assessed using the following guidelines:

For most staff assessment is by supervisor and line manager
For supervisory staff assessment is by line manager and Head of Department
For Managers assessment is by Head of Department and Director
For Head of Department assessment is by Director.

All assessments and scoring of individuals will be on a predetermined format. Personnel will ensure that all supervisors, line managers, Heads of Department and the Director have a common understanding of the criteria for scoring. The assessors will independently score the individuals in the relevant pool and only on completion of this exercise will scores be compared. Any discrepancies between the scores will be resolved through debate. A final, agreed score sheet will be signed off by the supervisors, managers and Heads of Department involved, recording the reasons for any discrepancies between the original scores and the grounds under which the discrepancies were resolved. The Personnel Manager will review all scores for staff up to and including managers, for consistency during the period prior to introduction of a jointly agreed appraisal scheme. The original sheets and the agreed final score sheet will be retained by personnel for a period of six months. If after the introduction of a new appraisal scheme the definitions for how points are awarded are no longer appropriate, the definitions will be amended after consultation staff.

Overall Performance (OP)

OP is outstanding and consistently exceeds the requirements of the job = 10
OP exceeds the requirements of the job = 8
OP meets the requirements of the job = 6
OP meets most of the requirements of the job = 4
OP fails to meet the requirements of the job = 0

The employer places great importance on this criterion to ensure that the organisation retains a committed and balanced workforce. As a consequence, this factor has been given a weighting of (decide the necessary weighting factor, if any, and any points awarded will be multiplied by that weighting factor).