Guest bloggers Zoë Ashcroft and Alex Abbott of law firm Winston & Strawn provide a helping hand for firms tackling employment issues.

As the recession hits, Companies are being forced to consider money saving tactics and make difficult decisions.  Redundancies may be contemplated.

If your business is contemplating redundancies, read on.

We all think we know what redundancy means, and yet the word itself is a term of art created by, and enshrined in, employment legislation.

The law surrounding the termination of employment is a minefield.  Employers need to take steps to minimise the risk of successful claims being brought against them.

When making redundancies, employers must ensure that the dismissal is fair and lawful to protect themselves from claims for unfair dismissal (under employment legislation) or wrongful dismissal (a breach of employment contract).  Employers will also need to comply with discrimination legislation relating to matters such as sex, gender, race, religion and age discrimination together with a myriad of other employment regulations.  For example, if more than 20 employees are to be made redundant over a 90 day period, the government must be informed.

What does all this mean?

As an employer you need to tread carefully.  There are specific rules regarding the manner in which you can terminate employment relationships, which if followed, will help to protect you from exposure to expensive claims.  No only must you be fair in your selection criteria but also in the process.  If you fail to follow the correct procedure you risk the termination being viewed as automatically unfair by a tribunal.

Unfortunately, redundancy is a highly technical area of law, impossible to deal with in any real detail here, but in a nutshell, an employer considering redundancies should consult their lawyer to protect themselves.