What is The Collective Consultation Process? An Inside Look
Recently, Meta, the social media giant which owns brands such as Facebook, Instagram, and WhatsApp, made headlines with the announcement about their substantial employment cuts, removing a reported 13% of its workforce (around 11,000 employees).
However, there are others. Major companies, including Amazon, Netflix, Twitter, and Tesla, have also made similar large-scale redundancies in the last year.
In a statement regarding the Meta layoffs, Zuckerberg put it down to overestimating the accelerated growth seen during Covid.
“Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
Meta has a global workforce, and according to the most recent Companies House filing, they employed over 5,000 people in the UK as of December 2021, with additional local reports stating they directly employ a further 3,000 people, plus many more contractors in Dublin.
So far, they have declined to confirm the number of redundancies for each country. Still, due to the potentially large number of redundancies across the UK, Meta will need to follow correct redundancy procedures under UK employment law.
And this will go for any UK employer considering staff cuts, as businesses must follow a minimum procedure before dismissing any employees.
In this article, our Employment Law team takes a closer look at the Collective Consultation Redundancy process, with some guidance on the procedures involved.
What is Collective Consultation?
Collective consultation is the mandatory process that must take place between an employer and any employees – or their representatives – who are affected by a potential large-scale redundancy, from one establishment, within a set period.
Under UK employment law, ‘collective consultation’ rules must apply in cases where an employer plans to make 20 or more employees redundant from a single establishment within 90 days.
If these procedures are not followed correctly, the redundancies could be deemed unfair, resulting in an potential employment tribunal claim against the employer.
What is involved in the Process?
The Collective Consultation process does not have to result in an agreement. Still, employers are advised to carry it out with a ‘view to reaching it, including ways of avoiding or reducing the redundancies’.
Collective Consultation rules state that employers must include these steps:
- Notify the Redundancy Payments Service (RPS) before consultation starts by filling out form HR1. Deadlines apply and depend on the number of staff affected. The form contains information about where to send it.
- Consult with the trade union representatives, elected employee representatives or directly with the staff concerned.
- Inform the representatives or the affected staff about the planned redundancies, giving them enough time to consider them.
- Respond to any requests for further information.
- Give any affected staff termination notices, providing the agreed leaving date.
- Issue redundancy notices once the consultation is complete.
What are the deadlines for notifying the Redundancy Payments Service (RPS)?
The deadline for notifying RPS depends on the number of proposed redundancies.
If you plan to make 20 to 99 employees redundant, you must submit your form at least 30 days before the date of the first redundancy. For cases with 100 or more proposed redundancies, the deadline falls 45 days before the first redundancy.
It is important to note that failure to notify the RPS could result in an uncapped fine.
How long should the consultation process last?
Although there is no time limit on the length of the consultation process, there is a minimum period before an employer is allowed to dismiss any employees.
For 20 to 99 redundancies, the minimum consultation period before dismissal must be at least 30 days before the first dismissal. In the case of 100 or more redundancies, the minimum length of the consultation period is 45 days.
What information must an employer provide?
To ensure the correct redundancy procedures are followed, the written information an employer must provide to the employee or employee representative includes the following:
- the reasons for redundancies
- the numbers and categories of employees involved
- the number of employees in each category
- how you plan to select employees for redundancy
- how you plan to carry out redundancies
- how you will work out redundancy payments
Unfortunately, redundancies can be a common part of the business lifecycle, especially when the economy is facing difficulties.
However, if redundancy processes are dealt with incorrectly, employment tribunal proceedings may arise; therefore, it is vitally important that the procedure is administered correctly to protect the employer’s position and the employee’s rights.
Even where there is a genuine redundancy situation, an employer must follow a minimum procedure before it dismisses any employees.
Depending on how many employees are affected, as discussed in this article, employment law may require an employer to comply with special consultation requirements.
Specialist Employment Law Solicitors
At Eric Robinson Solicitors, our highly experienced employment law team can advise employers faced with a redundancy situation to ensure they are following the proper and lawful processes.
Equally, if you are an employee who has been made redundant, but you believe that there was another reason for your dismissal or the correct procedures were not followed, we can advise you on whether you have an employment tribunal claim for unfair dismissal.
To discuss an employment law issue or dispute, don’t hesitate to get in touch with us today.
This blog post is not intended to be taken as advice; information could have changed since the article was published. If you are seeking legal advice, please get in touch with our team of solicitors to discuss your matter.