The extent of the statutory obligation to consult collectively

The employer’s statutory obligation is to consult in good time, about ways of:

• avoiding dismissals;

• reducing the number of employees to be dismissed; and

• mitigating the consequences of the dismissals.

(See section 188(2) TULRCA)

This should form the basic agenda for any consultative meetings on redundancy. The law requires the employer to consult on each of the three headings. Otherwise, the consultation will be inadequate. It is not good enough for the employer just to provide an opportunity for consultation on these topics. If reps do not raise them, the employer must raise them, or risk a protective award (Kelly v The Hesley Group Limited [2013] UKEAT/0339/12/ZT).

Consultation must be sufficient and meaningful, real and not a sham. The employer must consider representations from reps and reply to them (R v British Coal ex parte Price [1994] IRLR 72). Consultation should cover the business case for any proposed changes that, if implemented, will almost certainly result in redundancies (see UK Coal Mining Limited v National Union of Mineworkers (Northumberland Area) [2008] ICR 163).

An employer who decides to make redundancies before consulting with reps is not engaging in meaningful consultation and is likely to be subject to a protective award (Middlesborough Borough Council v T&G and UNISON [2002] IRLR 332). So is one who makes it clear from the start that redundancies are non-negotiable. Holding meetings is not enough to establish meaningful consultation (King v Eaton [1996] IRLR 199).

An employer’s belief, based on past experience, that employees do not like consultation is not an excuse for failing to consult (Ferguson v Prestwick Circuits [1992] IRLR 266). Even if the employer reasonably believes there is no alternative to redundancies, they must still consult. Unions or employees may know something that changes the situation (Heron v Citylink [1993] IRLR 312).

Meaningful consultation means exploring and responding effectively to all ideas reasonably suggested by the union to avoid redundancies, reduce their number and mitigate their effects. Failing to explore all these suggestions risks a protective award.

Any agreements to freeze wages, cut pay, terms or hours should be temporary, or at least have a review date. In particular, reps should remember that the law calculates statutory redundancy pay based on wages and hours at the date of dismissal — not any earlier date. Only if a cut in hours amounts to “short-time working” (i.e. working for less than half a week’s pay — see Chapter 9) will statutory redundancy payments be worked out using the pay and hours that pre-dated the cut. So reps should make sure that if hours or pay are cut to try to save jobs, the agreement specifically states that if redundancies cannot be avoided, they will be calculated using the pay and benefits in force before the pay cut.