In this article, we focus on one of the most important aspects of a fair redundancy process: the use of objective selection criteria. For many small and medium-sized businesses, redundancy is one of the more difficult processes to manage, not just legally, but emotionally and practically too. Whether it’s due to a shift in demand, a restructure, or financial pressure, letting people go is never easy.
Handled properly, a redundancy process can be fair, respectful and legally sound. But when key steps are missed, particularly around how employees are selected, it can lead to confusion, complaints, and risk.
Before anything else, it’s important to confirm that redundancy is the right route. In law, redundancy applies when:
It’s about the role, not the person. If the business issue is really about conduct or capability, redundancy won’t be the right legal or ethical approach.
For businesses proposing 20 or more redundancies within a 90-day period, additional legal obligations apply, including collective consultation and notification to the Secretary of State. If you’re close to this threshold, you should seek specific advice.
If you have more than one employee doing similar work, you’ll usually need to identify a selection pool, a group of people at risk, from which some may be made redundant. This step needs to be carefully thought through and based on logic that can be explained if challenged.
It’s also worth documenting why certain employees are or aren’t included in the pool, especially if the roles aren’t identical but have some overlap.
When you’re selecting from a pool, the criteria you use need to be as fair and evidence-based as possible. That means:
Some examples of appropriate objective selection criteria include:
Avoid overly vague terms like “attitude” or “team fit” unless you have clearly defined, job-relevant indicators to support them.
When applying criteria, it helps to have more than one person involved in scoring to reduce unconscious bias and ensure a balanced view.
Every score should be backed up by evidence, whether it’s training records, appraisal outcomes or attendance logs, and the scoring process itself should be documented. This isn’t just good practice; it’s essential if your decision is ever challenged.
Employees have a right to be consulted about proposed redundancies, including how their selection was assessed. A fair process means:
Even in smaller businesses, this part of the process matters. It gives employees a voice and ensures decisions are seen as fair, even in difficult circumstances.
As part of a fair redundancy process, employers have a duty to actively consider whether there are any suitable alternative roles within the business for employees at risk. This isn’t a box-ticking exercise. You are expected to make a genuine effort to identify and offer roles that could be appropriate based on skills, experience and terms. The role doesn’t have to be identical, but it must be suitable in terms of status, pay, location and duties. If an employee unreasonably refuses a suitable alternative, they may forfeit their right to redundancy pay, but that decision needs careful handling and a clear paper trail. It’s also good practice to offer a trial period in any alternative role, to allow both sides to assess the fit.
After consultation, you can confirm your final decision, issue redundancy notices, and support employees through the next steps, including notice periods, redundancy pay, and, where relevant, outplacement support or references. Offering the right to appeal a redundancy decision helps demonstrate procedural fairness and can reduce the risk of future claims.
Redundancy is a business decision, but it’s also a human one. Using fair, objective selection criteria helps ensure that those decisions are made responsibly and that employees are treated with dignity throughout the process.
Where roles often overlap and relationships are closer, getting this right is especially important. It protects the business legally and preserves the internal culture for those who remain.
If you’re navigating a potential redundancy situation and want a second pair of eyes on your approach, at HPC, we’re happy to help, whether that’s reviewing your selection criteria, facilitating consultation, or advising on the right structure for your process.
To find out more information or to discuss redundancies and objective selection criteria, please get in contact with our team of experts.
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