Need to downsize your staff? Here’s how – Part 1 Redundancy
DENTAL BULLETIN, ISSUE 40
Every practice will evolve over time and staffing needs will change. When your practice is running smoothly, you will have little to worry about, but, there will always be concerns for what the future may hold. Having in place the tools and knowhow to deal with staff changes will give you at least some piece of mind that you can deal with any situation that may arise.
If someone is stealing from you then it can be an easy decision, as you will have lost trust in them. However, when you have three good dental nurses but only require two, how do you pick? Or what happens when your current part time dental nurses do not meet your business hours but you know a full time nurse that can?
Here we look at this difficult area of managing people; letting staff go even if they are perfectly good at their jobs.
Redundancy or Some Other Substantial Reason (SOSR)
The first step is to determine if you have a redundancy situation or SOSR dismissal.
3 Circumstances when a redundancy situation will arise:
1. Business closure, namely the entire business will cease;
2. Workplace closure, namely one or more sites of the business will close; or
3. Diminished requirements of the business for employees to do work of a particular kind.
Redundancies are less common in the dental profession as there is normally a steady flow of work.
However, we often get asked to advice on a situation where one of two part time employees resigns and a practice has difficulties in filling those part time hours but would have no difficultly in employing for a full time position. There is often a misconception that this would amount to a redundancy for the remaining part time employee, but this is incorrect as the work has not diminished.
This is why SOSR dismissals were added to legislation to cover ‘some other substantial reason of a kind as to justify the dismissal’. The reason relied on therefore must be both substantial, rather than frivolous, and it must warrant dismissal rather than another sanction. This covers a scenario where the practice needs to change contractual hours to fit the needs of the business.
Before you can make an employee redundant, you need to go through the formal consultation process outlined below.
Volunteer for redundancy
It is worth asking if any employees wish to volunteer for redundancy before this process is undertaken. The advantage of this is that if an employee accepts the offer you could avoid the formal process altogether. You should make an offer over and above the minimum statutory amounts payable as an incentive to any employee wishing to apply. You should also ensure that the offer is conditional on the employee signing a settlement agreement preventing them from pursuing any claims against you in the future.
The main disadvantage to this is that you may have a very good employee who you want to keep asking for voluntary redundancy. If a redundancy situation arises you will want to ensure that you retain your best employees (we will give advice on how to do this later in the article). If they ask for voluntary redundancy, that could leave you with a difficult decision.
Ensure you reserve the right not to accept any application when the offer of voluntary redundancy is made. Also make it clear beforehand that if there are more volunteers than needed, how you will assess applications to avoid allegations of discrimination or unfair treatment.
Formal redundancy process
If you decide not to offer voluntary redundancies or no one wishes to take up voluntary redundancy, then you will need to move to a formal redundancy process. We would recommend you seek legal advice on how to undertake this process but essentially you should:
1. Identify the correct pool of employees at risk;
2. Inform and consult with those affected employees (if you are making more than 20 employees redundant you have a duty to undertake collective consultation);
3. Determine the method of selection, for example using a scoring matrix, interview style or last in first out;
4. Consider alternatives to redundancy;
5. Ensure you follow a fair process.
If you want to ensure you retain the best staff, create a selection matrix which will ensure the employees you want to keep score highly. As long as the selection criteria can be objectively assessed, it will be very difficult for any employee to challenge it at the Tribunal. Potentially fair selection criteria include performance, length of service, attendance records, patient feedback and disciplinary records.
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Laura Pearce, Senior Solicitor