Redundancy consultation outcomes to be improved
The Business Minister Jo Swinson launches a call for evidence seeking views on how to improve consultation and information sharing between employers and employees when a company is faced with insolvency.
The Insolvency Service is seeking views from industry and the public on the challenges faced by businesses around consulting employees about potential redundancies surrounding insolvency and how to make consultation more effective to improve the outcomes for both the employer and employee.
Jo Swinson said:
“Constructive engagement with employees is important for business at all times, but especially when facing situations such as insolvency. The purpose of this call for evidence is to look at consultation with employees where a business is facing insolvency or has moved into an insolvency process.”
“Whilst our current system generally works well and is effectively complied with and its benefits agreed upon, we want to explore in more detail how consultation operates in these situations and what are the challenges and best approaches.”
Jo Swinson met with key stakeholders last month to hear first hand how the industry viewed the current legislation, what the difficulties were and what support was available for both employers and employees facing redundancy.
The call for evidence, which will run for 12 weeks, is asking views on:
- understanding of the current requirements, their purpose and benefits
- factors that facilitate or inhibit effective consultation
- ensuring timely notification and effective consultation
Notes to editors
Employers proposing to make more than 20 employees redundant at an establishment within any 90 day period must consult them and inform the Secretary of State for Business, Innovation and Skills about the proposals.
Consultation can mean that unnecessary redundancies are avoided or the impact mitigated.
Inadequate consultation can lead to a Protective Award being made against the employer by an Employment Tribunal. If the business is insolvent some or all of the Protective Award may be claimed from the National Insurance Fund.
In some high profile cases the cost of this to the taxpayer has run to tens of millions of pounds.
Latest News from
New powers to tackle unfit directors of dissolved companies12/05/2021 15:20:00
New legislation to target company directors who dissolve their businesses and leave staff or taxpayers out of pocket.
Pre-pack sales to face mandatory independent scrutiny09/10/2020 11:22:00
New laws will require mandatory independent scrutiny of pre-pack administration sales where connected parties are involved in the purchase.
Regulations temporarily suspended to fast-track supplies of PPE to NHS staff and protect companies hit by COVID-1915/05/2020 16:21:00
New measures announced yesterday will give vital support to frontline NHS staff battling COVID-19 and support businesses under pressure as a result of the coronavirus outbreak.
Regulations temporarily suspended to fast-track supplies of PPE to NHS staff and protect companies hit by COVID-1930/03/2020 16:14:00
New measures announced recently (28 March 2020) will give vital support to frontline NHS staff battling COVID-19 and support businesses under pressure as a result of the coronavirus outbreak.
Dean Beale appointed Chief Executive of the Insolvency Service07/01/2020 13:12:00
Dean Beale has been appointed as Chief Executive Officer of the Insolvency Service.
Thomas Cook: information for customers, employees, creditors and shareholders23/09/2019 14:48:00
Information for customers, employees, creditors and shareholders of Thomas Cook in liquidation.
Companies involved in fraudulent art investment scheme wound-up14/03/2019 09:10:00
Two companies involved in what appears to be a fraudulent art investment scheme have been shut down after abusing close to £1.4 million of investors’ money.
Online small business directory shut down by court05/03/2019 12:10:00
Preston company behind online small business directory shut down by the courts after customers complained they were harassed to pay bills they did not owe.