Redundancy: advisers help, managers deliver the news

Key takeaways

In a redundancy process, the business decides whether roles go, how people are selected and who delivers the news, and those steps should never be outsourced. HR advisers can guide the process and check fairness, and an outsourced team can calculate payments and prepare letters. Employees should hear the news from their own managers, face to face.

• Keep: the business case, selection decisions and conversations.
• Outsource: pay calculations, letters, records and scheduling.
• Consult individually; consult collectively at 20+ redundancies at one site in 90 days.
• Statutory redundancy pay applies after two years' service.

Why must managers deliver redundancy news?

Because how people leave shapes how those who stay feel about the business. News delivered by an outsider tells staff the leaders did not care enough to face them. Managers who explain the reasons honestly, listen and treat people with respect protect morale and reduce the risk of claims.

• Which business processes should you never outsource?
• Can line management be outsourced?

What are the main legal steps?

A genuine redundancy, fair selection and proper consultation are the core. Take advice, because mistakes can lead to unfair dismissal claims.

• Confirm there is a genuine redundancy situation.
• Use fair, objective selection criteria.
• Consult each affected employee individually.
• Consider suitable alternative roles.
• Give correct notice and redundancy pay.

• Redundancy vs contract exit: the cost of scaling down
• Workplace investigations: when an outsider is better

When is collective consultation needed?

When you propose 20 or more redundancies at one establishment within 90 days. Consultation must start at least 30 days before the first dismissal (45 days for 100 or more), and you must notify the Insolvency Service's Redundancy Payments Service using form HR1. Most small redundancies fall below this threshold.

• TUPE and outsourcing: what UK employers need to know

What admin can be outsourced?

Calculating statutory and contractual redundancy pay, preparing consultation and notice letters from approved templates, scheduling meetings, updating payroll and records, and preparing reference and leaver paperwork. This lets managers focus on the conversations.

• Keep the decision, outsource the admin around it
• Employee records: keep them complete, lawful and current

What does this look like in practice?

A pattern we see: owners delay difficult conversations while paperwork piles up. With letters, calculations and scheduling prepared in advance, managers can hold the meetings promptly and treat people well.

• See client work
• BPO Solutions for UK businesses

Redundancy process checklist

• Write the business case for the change.
• Agree fair selection criteria.
• Take employment law advice.
• Prepare letters and pay calculations in advance.
• Managers hold every conversation in person.
• Support the people who stay.

• Can line management be outsourced?
• Pay rises and bonuses: decisions that stay in-house

Next step

If you are considering redundancies, take employment law advice before telling anyone, and plan who will speak to each person.