Redundancy consultation period halved

The Government has announced plans to reduce the current 90 day minimum period before very large scale redundancies can take place to 45 days.

It also announced plans to legislate to make clear that fixed term contracts which have reached the end of their natural life are excluded from obligations for collective redundancies consultation and introduce new non-statutory Acas guidance to address a number of key issues affecting collective redundancies consultation.

Employment Relations Minister Jo Swinson said: “The UK has a labour market that is flexible, efficient and fair but some of our laws need reform to respond to an ever changing employment landscape.

“We want to improve the quality of consultations by making sure that there are tools available to help employers manage this process fairly and successfully to deliver the best possible outcomes for all parties. Acas will be working with stakeholders to produce non-statutory guidance that will be designed to help improve the quality of consultations.

“We have listened to stakeholders and there is a strong argument for shortening the minimum period which is backed up by hard evidence.

“The process is usually completed well within the existing 90-day minimum period, which can cause unnecessary delays for restructuring, and make it difficult for those affected to get new jobs quickly.

“Our reforms will strike an appropriate balance between making sure employees are engaged in decisions about their future and allowing employers greater certainty and flexibility to take necessary steps to restructure.”

Today’s announcement responds to a consultation launched in June. The Government says the replacement of the current 90-day period to 45 days will still allow full employee engagement and offer employee representatives a statutory right to contribute to the process. The new 45-day period will be a minimum period, and businesses may consult for longer where appropriate.

The changes will be made through secondary legislation. Draft regulations will be laid in the New Year and the changes are expected to be made by 6 April 2013.

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