The dos and don’ts of redundancy for both employees and employers

It’s a sad sign of the times that so many people have been affected by redundancy in the past five years, either as a victim or perhaps as the person who has had to say: “I’m so sorry, but we’ve got to let you go.”

“Until the 2008 downturn, redundancy was usually something that happened to other people,” management analyst James Parker says. “Then, when 3,000 people a day were losing their jobs, it was happening to us.”

Now ‘redundancy management’ has become big business, with at the last count some 20,000 UK analysts, therapists, financial management experts and lifestyle gurus anxious to help soften the blow of losing your job.

As a result, there’s no shortage of dos and don’ts to help you through that difficult time - and here are some that experts reckon are the most effective:

If you’re an employee. Do:

• Get all your entitlements. If you’ve worked for the company for more than two years, you are due a minimum of one and a half weeks’ pay per year of service, but many firms will pay more - two to four weeks’ pay, plus cash in lieu of notice. Citizens Advice Bureau experts will help.
• Find out about financial help. While you get your life sorted, you might be entitled to certain benefits. Your local CAB will help here, too.
• Work out what you’re spending and make a plan. Try to cut debts and write a list of all family income. Experts advise against investing redundancy payouts or paying off part of your mortgage. Instead, keep the money somewhere easily accessible until you see what the immediate future holds.
• Jump at the chance to get more qualifications. Management and entrepreneurship courses have grown by 500 per cent in the past four years. Half the UK’s colleges and universities are running special courses for redundancy victims who are anxious to start their own businesses.
• Network like mad. Networking is doubling in growth every year through organised groups from chambers of commerce to business angel groups, but mainly through the internet, where there are now two million networking groups and clubs that generated £20 billion of business last year.
• Perform a career check and rewrite your CV. Make sure your skills are up to date and make a list of your attributes, training and education. Having a break could be a great time to get further skills and qualifications or even make a career change.
• Keep active and healthy. Studies have shown the stress that invariably comes with redundancy can be dramatically eased by physical activity and exercise. Effective stress beaters are dancing, pilates, yoga, meditation, swimming and brisk walking.

If you’re an employee. Don’t:

• Be too proud to take advantage of help and facilities offered by your former employer. Many firms forced to let staff go are including the services of career management and outplacement advisers in redundancy packages.
• Lose heart. With the right attitude and good advice, redundancy need not be a disaster. Don’t go into denial and feel ashamed. In most cases of redundancy, it’s not the person who has failed, but the job they were given.
• Assume you will quickly get another job and so spend your redundancy payment on upgrading your home, a holiday or a new car. Case studies have shown that when this happens and a job is not immediately forthcoming, it can double a family’s stress levels and financial difficulties.
• Keep your problems to yourself. Studies show that when a redundancy victim shares his difficulties with friends and family, they invariably rally behind him, helping him to overcome his problems. On the other hand, too much doom and gloom will put everyone into a depressed mood.
• Criticise your old company after redundancy. Word will get around that you could be a troublemaker, particularly if you left with bad feeling on both sides. Obviously it’s hard to feel philosophical about getting the chop, but the less aggravation there is the better the chances of getting another job in the same field.
• Think life is over after redundancy. Latest figures show 50 per cent of those who lose their jobs get new ones within six months and over 20 per cent of post-redundancy jobs are better paid than the ones they lost.

If you’re an employer. Do:

• Prepare carefully. Remember that although employers can legally make workers redundant, workers can question the decision, so make sure you have a watertight case. As soon as possible, have a meeting with affected employees to tell them your intentions. Ask for volunteers for redundancy and give employees the chance to put forward ways of avoiding losing their jobs.
• Keep things cool. Tell workers they have the right of appeal against your decision to make them redundant and make sure they know how to do this. It’s a bad time for everyone, but keep things legal and efficient and you shouldn’t fall out.
• Present information clearly. Avoid management speak and use plain English, so that workers can easily understand your plans. Otherwise a tribunal may throw your proposals out on appeal.
• Search for alternative employment in the company for workers at risk of redundancy. Just asking them to submit a CV is not enough. Interview everyone who could be suitable for a vacancy in other parts of the business.
• Talk instead of write. Encourage verbal discussions instead of emails. Well planned redundancy negations can be wrecked by too many unhelpful documents, which can later be used by redundancy victims in litigation. Deliver the bad news in person - unlike what happened in 2010 when Essex police first heard about redundancies in the force magazine.
• Make sure everyone is properly represented. If 20 or more redundancies are proposed, workers should be represented by a union, a friend or members of an employee forum. It’s important that everyone knows their rights.

If you’re an employer. Don’t:

• Try to turn bad news into good news. An announcement about redundancy isn’t going to be made more palatable by a lecture on the benefits the changes will bring to the organisation. Especially if your listeners won’t be part of it.
• Make assumptions about how staff will react to redundancy. Experts are surprised how often workers will prefer a job at half pay to redundancy when they have previously volunteered to be laid off.
• Turn redundancy into a case for unfair dismissal by basing your decisions on personal rather than professional reasons. These include discriminating against workers on grounds of gender, age or disability, or not offering alternative employment if available.
•Use ‘last in, first out’ as a way to choose redundancies. This is invariably rejected by tribunals on the grounds of age discrimination.
• Leave pregnant employees out of the redundancy process. Excluding them can make it unfair to those not pregnant or on maternity leave.
• Unfairly select someone for redundancy. You must be able to justify your decision. Recently an employer had to pay compensation to a worker made redundant ‘for being lazy’. And a secretary was unfairly made redundant because the boss wanted someone ‘young and pretty’.
• Be surprised by the emotional reaction when telling a group they are being made redundant. You will probably become the focus of anger/sadness, but don’t argue - just pass on the news as sympathetically as possible. Perhaps have the support of a colleague, so long as you don’t come across as ‘them and us’.
• Finally, don’t go down the redundancy route without exhausting every other option, from capping overtime and changing working methods, to modifying hours and natural wastage.
As James Parker says: “Financially, things are getting better and if you can put off the evil day, who knows, there’s always a chance it might not arrive after all.”