For those of you who haven't ever visited Stamford, it is an historic market town and to all intents "well heeled".  The shocking news announced at the meeting was that Stamford's unemployment is double that of the local towns that are traditionally less affluent.  The reason?  Stamford has no manufacturing and is predominantly a leisure and retail centre – both of which have been hard hit in the downturn.

I was spurred on to see what we could do with our collective HR skills in interviewing, training and coaching.  After a lot of digging, I came across some ESF funding being delivered through an initiative called R2R … have you ever heard of it?

Well… that is the biggest problem the fund administrators at the East of England Development Agency (EEDA) are facing. You see, for businesses making more than 20 people redundant, there is an automatic notification process through the Job Centres. But if you are one of the businesses making less than 20 people redundant, there is no mechanism to let you know about the help and funding available.

Somewhat worryingly, the Job Centres are so overloaded they are not able to meaningfully help unless there are over 80 redundancies!

What would it be like to take the emotional burden off your shoulders and arrange an hour-long meeting for each employee at risk of redundancy to discuss their career and prospects? Discussion with an independent career adviser appointed by R2R who has the experience and expertise to give practical, helpful advice on how to go about finding their next job?  The R2R fund has been set up specifically to reduce the financial burden of this kind of service, and your employees could be eligible.

As with all funding, only some employees will qualify. To see if your employees qualify for arguably the best advice they can get (at no cost to you), go to www.recrion.co.uk/FREE

If you have any questions we would be happy to help – call an independent career adviser at Recrion on 01780 484910.

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Question 20: How can offering someone an alternative job lead to an unfair dismissal claim?

Answer:

To ensure that you don't incur an unfair dismissal claim, ensure that the employee knows that if they want to turn down the new job, they must do it within the four-week period.

Also make sure that any proposed alternative employment is suitable for the employee.

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Question 19: What duties do employee representatives elected for redundancy consultation have?

Answer:

• Represent the views and opinions of all the affected employees in the information and consultation process
• The employer must disclose certain information to the representatives

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Question 18: What happens about redundancy payments if the employee wants to leave early?

Answer:
If the employer does not object, redundancy settlement is not affected.

If the employer objects, then the employer must serve written notice on the employee to withdraw the notice and continue until the original termination date.

In the event of a claim, employment tribunal will decide:

• whether the request for early departure by employee was reasonable
• reasons why employer required employee to continue in employment

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Question 17: How do you minimise the risk of damaging your business reputation?

Answer:

• Poorly handled redundancies can damage customer perception of your brand
• Employees are often customers as well as workers
• Provide outplacement support to leaving employees and keep the remaining staff motivated and engaged

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Question 16: How do I break the news of redundancy?

Answer:

• Individuals react in different ways
• Prepare for several eventualities
• Be compassionate, firm, empathetic
• Balance the organisation's perspective with your own values and beliefs

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Question 15: How is an employee’s pension calculated in a redundancy situation?

Answer:

• Pension accruals must be included in a severance payment
• If part of the severance is transferred into employee’s pension scheme no NI is payable
• If an employee is aged 50 before 6 April 2010, they can take benefits from their 50th birthday

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Question 14: Compromise agreements … what are they and when could they be used?

Answer:
A compromise agreement is a mutual agreement to terminate the employment relationship.
It is used to:

• avoid the costs, risks and delay of possible legal proceedings
• a means by which the employer can offer an enhanced package to an employee facing redundancy

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Question 13: How can redundancy settlements be made as tax efficient as possible?

Answer:

• £30,000 of redundancy is tax free
• Over £30,000 is taxed at employee’s highest rate
• If still employed, full PAYE deductions will be made on settlements over £30,000
• If employee has already left, 20% will be deducted initially resulting in a temporary cash flow benefit for up to 12 months

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Question 12: What are the statutory dismissal procedures in a redundancy situation?

Answer:
The statutory dismissal procedure requires an employer to tell an employee:

• the reason for the redundancy
• the selection criteria
• his or her score

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