The employer’s guide to restructure & redundancy. Part 5: the final decision

Welcome to part five of our series that guides employers on how to proceed compliantly with a restructure and a redundancy. In this section, we’ll examine how to make the final decision.

Making the tough calls

The final decision on restructuring and redundancy is always the responsibility of the business owner, the employer. The consultation process doesn’t transfer decision-making power to the employees. Similarly, the responsibility for a fair and compliant process is always the responsibility of the employer, not the employees. Potentially, the greatest risk an employer faces is that they act contrary to the law, whether knowingly or not, and an affected employee knows and sees the non-compliance but does nothing to make them aware of it during the process, knowing that this will make for a legitimate dispute later on.

The employer is responsible for clearly and openly showing how they considered the consultation feedback and showing that they have good reasons for rejecting any aspect of it. It is not enough to say, generally, “We’ve considered the feedback but none of it’s useful”. We recommend every employer use a feedback template, where each representation is listed and the reasons for not accepting it are specifically documented. In larger numbers, it would be fine to group similar suggestions together for this purpose.

Communicating a decision well is important. We recommend employers do this face-to-face, wherever possible. Possibly the greatest erosion of trust occurs when executives make decisions that affect the lives and livelihood of employees, but don’t show up to own and represent those decisions in person. And the greatest builder of trust and respect is when they do. Face-to-face decisions aren’t always possible owing to reasons such as multiple locations, travel and sheer numbers of employees. Where this is the case, video or senior management representatives are the next-best method of communication.

Five important things to tell your employees if you decide to restructure

When you meet with your employees to inform them of your decision to restructure, you need to include the five key details below:

• What the final decision is, and how it differs from the original proposal and why;
• What employee representations were accepted and why, and which were rejected and why;
• How many positions are affected (but not which employees specifically);
• That the affected employees will be met with privately, and when this will happen; and
• When the process will be concluded by.

If the meeting itself is the first time that the affected employees hear about the final decision, and its effect on their jobs, it can be overwhelming. This would be more significant when “affected” means “made redundant” than when it means a lesser change is being made. Good practice is to let affected employees know, perhaps 30 minutes before the meeting, that their positions are among those affected, and that they will be met with privately in the next few days, along with their representatives, and that all remaining issues will be dealt with privately with them. The affected employee could then be given the option to attend the general meeting or to be absent if they wanted to.

If this article has raised any questions or concerns or you’d like to learn more about how we can help your business, please reach out to our workplace relations experts via our 24/7 HR Advice Line.