Redundancy consultation review risks increased unemployment

Cutting consultation times during collective redundancy procedures could increase job losses and damage staff morale, the Trade Union Congress (TUC) has warned.

In response to a recent Government consultation regarding current redundancy rules, the TUC believes the Department for Business, Innovation and Skills (BIS) is considering cutting the 90 day redundancy consultation period, making it easier and more cost efficient for businesses to lay off staff.

Current legislation stipulates that employers proposing the redundancy of between 20 and 99 employees must allow for a 30 day consultation period with unions or workplace representatives before any job cuts can be made. This consolation period is increased to 90 days where 100 or more jobs are at risk.

However, according to the BIS who are heading the consultation, the legislations, which have been in place since 1975, seriously affect the employer's ability to react effectively to changing market conditions which can leave businesses at risk.

The review forms part of the Government's Employment Law Review and the Red Tape Challenge which aims to ease the mounting red tape burden that is hampering UK businesses.

In a public statement, the TUC have said that genuine redundancy consultation and effective negotiations between unions and employers help maintain a transparent and fair restructuring process which can 'lower job losses, avoid compulsory redundancies and assist employers to retain skilled staff.'

The TUC's general secretary Brendan Barber said: "Genuine consultation between unions and employers is vital in a redundancy process, regardless of how many people are at risk of losing their jobs. Working together, unions and bosses can decrease the number of job losses, avoid compulsory redundancies and ensure that the redundancy process is fair. They can also retain skilled staff and maintain morale amongst remaining staff.

"As a result of the recession and government spending cuts, unemployment is now running at more than 2.6 million and tens of thousands of jobs will continue to be lost in the public sector this year. Rather than cutting back on consultation rights, now is the time for ministers to strengthen collective redundancy arrangements and protect working people and employers."