Job Losses and Compromise Agreements

 

News that British business expects still more redundancies in coming months brings no cheer anywhere. We may have suffered fewer cuts in 2009 than might have been expected but that is partly due to constructive initiatives by employers to keep people in work on shorter hours. It now seems likely that the public sector which has so far suffered fewer personnel cuts than the private sector will be shedding numbers.

Employees need to be firm in the face of proposals, whether from public or private sector employers, for staff reductions and be sure to take an active part in consultation from the earliest possible stage to ensure that the employer hears any suggestions to mitigate redundancies. Just making one’s presence felt might be the difference between being selected for redundancy or not. If your employer produces a compromise agreement to try to tempt you to accept better than basic terms that you may be entitled to under UK laws be critical yet realistic from the outset. There may be more available or it may be that if you resist the employer will keep you on. See “Compromise Agreements” on Services dropdown on home page.

Employers should be careful when making redundancies to think well ahead of announcing that redundancies may have to be made. Good planning will make a lot of difference; providing frank information about the company’s predicament may help to keep staff understanding of the firm’s difficulties despite naturally wanting to do the best for themselves; and fair and open selection criteria will give staff confidence that you are not picking on people randomly. It is a painful time for all but retaining your employees’ goodwill in the process will go a long way to avoid unnecessary unhappiness. If possible, an employer should try to make an ex gratia payment and would normally be well advised to ask staff made redundant to sign a compromise agreement (see above) to bring all possible claims to closure.