Redundancy has a statutory definition in an employment law context. s. 139 of the Employment Rights Act 1996 states:

s.139 Redundancy

(1)For the purposes of this Act an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to—

(a)the fact that his employer has ceased or intends to cease—

(i)to carry on the business for the purposes of which the employee was employed by him, or

(ii)to carry on that business in the place where the employee was so employed, or

(b)the fact that the requirements of that business—

(i)for employees to carry out work of a particular kind, or

(ii)for employees to carry out work of a particular kind in the place where the employee was employed by the employer,

have ceased or diminished or are expected to cease or diminish.

A pool for selection is a group of employees carrying out interchangeable jobs from which you will selected people for redundancy.

You must consult with elected  employee representatives or trade union reps if you are proposing to make 20 or more people redundant in a 90 day period.

Suitable alternative employment is a role which you have available in your organisation that may be suitable for an employee at risk of redundancy. You have an obligation to offer such roles to potentially redundant employees and those employees have a right to a 4 week trial to determine whether it is suitable or not.

Redundant employees are entitled to all of the sums due under their contract on termination of their employment. If they have more than 2 years’ continuous service with you, they are also entitled to a statutory redundancy payment based on their age, length of service and a week’s gross pay (subject to a statutory cap).

Bumping is where you ‘bump’ an employee out of role that is not redundant to create a vacancy to retain the services of another employee who is at risk of redundancy. Bumping is not compulsory but it can be an effective way of retaining certain skills and experience within your business.

If there is a genuine redundancy situation and one of the employees in the pool for selection happens to be pregnant, they may be selected for redundancy, provided their selection can be objectively justified. It is automatically unfair and discriminatory to select someone for redundancy because of their pregnancy (or maternity leave). 

You can use length of service as one of your redundancy selection criteria as long as it is applied fairly.  Although you risk a claim of unlawful age discrimination if its inclusion cannot be objectively justified.

There is a minimum consultation period before the first redundancy takes effect of 30 days (if dismissing over 20 people in a 90 day period) or 45 days (if dismissing 100 or more people in a 90 day period), however there is no set timescale for how long the process should last. If you are making a small number of redundancies, the process could take a week. Alternatively, if you are making a lot of redundancies across your business, your process may take 90 days.