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Termination Redundancy Redundancy consultation pack

Redundancy consultation pack letter template

Use this model pack to issue to employees at the start of the redundancy consultation process, to explain the redundancy process from start to finish. It also includes the most frequently asked questions with answers. 

Redundancies are, unfortunately, a real possibility for any employee, so having a consistent and transparent approach to consultations is vital.

This gives the employee something to refer back to after the initial redundancy warning meeting and prevents a barrage of questions to the managers.

You must consult with your employees before finalising any redundancies.

If you do not hold genuine and meaningful consultation before making redundancies, employees could claim to an employment tribunal for unfair dismissal.

Consultation is when you talk and listen to affected employees. In collective consultation you also consult with their representatives.

You should use consultation to try and agree actions wherever possible, for example the selection criteria.

During consultation, you should discuss:

  • the changes that are needed, what you plan to do, and why
  • ways to avoid or make fewer redundancies
  • the skills and experience needed for the future
  • the criteria for selecting employees for redundancy
  • any concerns employees may have
  • how you can support and arrange time off for affected employees, for example to update their CVs and get training

You do not need to reach an agreement for consultation to end. Consultation should be meaningful and you should be able to show you have genuinely considered any suggestions or points made by each employee, even if you do not accept them.

This document is suitable for use in England & Wales and Scotland, and was last reviewed and revised on 9 August 2022

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Redundancy consultation pack

[Company name]

[Sender address]

[date]

[Recipient name]

[Recipient address]

Dear [Recipient first name],

Consultation pack

Throughout the course of the consultation process we will keep you informed at every stage of the process. This will be carried out through individual consultation meetings with your Line Manager or a member of the management team.

To assist the information process throughout the consultation we have produced a guide as follows which will hopefully answer some of the questions you may have at this stage.

  • Whilst the consultation process is taking place you will remain on full pay.
  • Advice will be available to help with writing a CV and putting application letters together should it be required.
  • To be entitled to redundancy pay you must have two years continuous service.

Stage 1

Announcement of intended redundancies

All affected employees will attend a meeting and receive an individual letter explaining the proposal to consider redundancies or other alternatives to reduce the employment cost base.

During this meeting possible options will be discussed and there will be an opportunity to ask any questions.

Stage 2

Individual consultation meetings

Every employee will have a minimum of [one | two] consultation[s] with their Line Manager or a member of the management team; these will be held on a one-to-one basis.

The purpose of these meetings is to keep you fully informed of any progress being made by the company in their decision regarding reducing employment costs and also to give you the opportunity to ask any questions you may have throughout the process.

Stage 3

Confirmation of redundancies

In the unfortunate event that your position is to be made redundant you will receive a letter at your home address confirming your redundancy entitlement, date of termination and letting you know when payment is to be made.

You will be given the right to appeal this decision within 5 working days of receipt of the letter.

Please remember that redundancies will only be made as a last resort, and if any, will only be made in minimal numbers.

Questions and Answers

Is redundancy pay taxable?

The first £30,000 redundancy element is not taxable and is also exempt from NI contributions. Payments in excess of this amount would be subject to tax and NI.

Is payment in lieu of notice taxable?

The Inland Revenue treats this is as earnings and, therefore, is subject to tax and NI.

How much redundancy pay would I be entitled to?

These figures will be discussed with you in your consultation meeting in the unfortunate event of your role being made redundant.

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All Redundancy templates

Use the templates in this redundancy template library to guide you through the key steps you need to take to make an employee redundant.

By using this redundancy library, you will ensure that your redundancy process is fair and legally compliant, which reduces the chance of any employees taking legal action against you.

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All Termination templates

Model termination documents designed to help you manage voluntary and involuntary contract terminations in various scenarios.

Either the employee or the employer can decide to terminate a contract of employment; Employees may terminate their contract by resigning from the employer, and an employer may terminate the contract by dismissing the employee.

Once purchased you may download any termination template at any time over a one year period. This unlimited download access includes all updates and additions during the subscription period.

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