Law and Labour » Collective redundancies

Employment Rights Bill update

Law and Labour — Sun, 23 Mar 2025 12:20:27 +0000

The Employment Rights Bill will bring sweeping changes to many areas of employment law once its provisions come into force. Its reforms will affect unfair dismissal, flexible working, statutory sick pay (SSP), family leave, fire and rehire, zero hours contracts and trade union law.

Between October and December 2024, the government consulted on four areas of the Bill: zero hours contracts, fire and rehire, trade unions and SSP. In March 2025, the government published its response to those consultations and also announced a series of amendments to the Bill.

The amendments include:

Zero hours contracts – the right to request contracts with guaranteed hours will apply to agency workers. Employers will have a duty to provide workers with a range of information about their right to guaranteed hours. Flexible working – there will be a new requirement for any refusal of a flexible working request on one of the statutory grounds to be reasonable. Employers will also have to explain their reason for refusal. SSP – low paid workers will no longer need to earn above the lower earnings limit to qualify for SSP. They will receive either 80% of their average weekly earnings or the current rate of SSP, whichever is lower. SSP will be payable from the first day of sickness absence. Workplace harassment – employers will have a duty to take all reasonable steps to prevent harassment of their employees by third parties. Employers could face civil claims for harassment where they have failed to take such steps. Redundancy collective consultation – the maximum period of the protective award will increase from 90 days to 180 days. Trade unions – there will be a series of changes to trade union and strike rules, such as changing the current notice period for industrial action from 7 to 10 days. Industrial action mandates will expire after 12 months instead of after 6 months.

We continue to monitor for further amendments.

Photograph: “people-400818_1280”.

P&O Ferries: was firing 800 staff unlawful?

Law and Labour — Sat, 19 Mar 2022 10:54:57 +0000

On 17 March 2022, the management of P&O Ferries announced by video call to 800 workers that their employment was to be terminated with immediate effect. Many are stunned that a major British employer could fire so many employees at will. However, there are potential legal consequences to P&O Ferries’ actions.

Under UK employment law, an employer needs a fair reason in order to dismiss an employee. It is unclear what reason P&O is likely to rely upon to justify the sackings. The company reportedly said the sackings were necessary “to reduce our crewing costs by 50 per cent, secure the future of our business and set it up for growth”.

One reason P&O Ferries might rely on is redundancy. This reason is appropriate where dismissal is due to a need to reduce headcount. However, P&O Ferries could struggle to prove that this was a genuine redundancy situation. It does not appear that staff numbers are being reduced; the main motivation appears to be reduction of staffing costs.

Alternatively, P&O Ferries could rely on the catch-all category of “some other substantial reason” (SOSR). This reason is typically used by employers where the reason for dismissal does not align neatly with one of the other legally accepted reasons for dismissal.

Whatever reason is chosen an employer must follow a fair procedure when dismissing staff. The appropriate procedure to follow depends on the reason for dismissal. With either redundancy or SOSR, a fair process involves consulting with employees prior to their dismissal. Given the swift manner in which the dismissals took place, no form of consultation seems to have occurred.

Without a fair reason or a fair procedure being followed prior to dismissal, P&O Ferries may find itself facing claims of unfair dismissal in the employment tribunal. However, those are not the only claims it could potentially face.

Where 100 employees or more are facing dismissal, an employer is legally required to take certain steps under collective consultation legislation. These include consulting collectively with employees at least 45 days before the date of the first dismissal. The penalty for not engaging in collective consultation is a protective award for each employee of up to 90 days’ gross pay. This is one of the most expensive liabilities an employer may face in employment law.

Another requirement is the need to notify the Secretary of State of the Department for Business, Energy and Industrial Strategy (BEIS) of the planned dismissals. The notification must be sent to BEIS at least 45 days before the first dismissal. Failure to do so is a criminal offence punishable by a fine. According to reports, the Government only learnt of the planned dismissals the night before the P&O Ferries announcement. The company’s directors could face criminal proceedings for failing to comply with the collective consultation obligations.

According to reports, P&O Ferries has offered its employees severance packages containing enhanced redundancy payments. These are likely being offered as a means of staving off claims for unfair dismissal and failure to carry out collective consultation. However, the company cannot dispel the potential criminal charges the company [...]

Redundancy talks period cut to 45 days

Law and Labour — Thu, 20 Dec 2012 21:52:03 +0000

The Government plans to cut the minimum consultation period for large-scale redundancies (over 100 staff) from 90 days to 45 days. An employer will have to ensure it complies with all the consultation obligations within a far shorter timeframe or it may be penalised for failure to consult.

According to the Government, the 45-day period will “allow employers to restructure more quickly” and enable those made redundant to “take advantage of career resources and begin the alternative job search sooner”. Employer associations agree that the change to 45 days will facilitate quicker restructuring and create a more flexible labour force.

Unsurprisingly, unions disagree with these views. They see the change as a further dilution of employees’ rights and another step that makes it easier to sack staff.

Employers will have been planning redundancies for weeks, if not months, so usually have an idea which, if any, employees are staying and which are leaving post-restructure. However, from personal experience I know that many employees first learn of an impending redundancy when they are called en-masse into a meeting with senior management and are told their department will be affected.

It may take weeks for an employee to move beyond the shock and anger triggered by the announcement and start planning for the future. For many employees, the 45-day consultation period will be too short a time to find new employment – particularly given the current economic climate – or to decide how to cope financially with an indefinite period of unemployment.

The changes will come into effect in April 2013.