8. Redundancy, reorganization, and transfers of undertakings

Abstract

This chapter discusses issues which arise when an employer faces hard times or stiff competition. The employer may need to sell or contract out part of its operation, dismiss some employees, or change the terms and conditions of work. The statutory definition of ‘redundancy’ is examined and is contrasted with termination of employment, or change in terms of employment, for other economic reasons. The chapter then deals with statutory redundancy payments and collective consultation on collective dismissals (whether for redundancy or other reasons). The discussion then focuses on how tribunals assess the fairness of redundancy dismissals and on the different approach taken as to the fairness of dismissals caused by reorganization which are categorized as being for ‘some other substantial reason’. Finally, the chapter addresses ‘TUPE’, which is the law governing the transfer of undertakings and situation where a service provider loses or gains a contract. The issues relate to the transfer to the new employer of individual and collective relationships, the protection of existing terms and conditions, and the legality of transfer-related dismissals and transfer-related changes to the employment contract.