With furlough coming to an end at the end of the month, I would expect to see a raft of redundancies from employers in businesses who have, unfortunately, not managed to recover sufficiently after Covid to afford their staff without the assistance of the furlough scheme.

Employers who may be in this position must start thinking about whether they need to make redundancies as soon as possible.  Part of the redundancy process must include assessing the business need and considering other alternatives e.g. ways for the business to save money without making redundancies.

However, that is not my warning to employers.  My warning relates to selecting employees who have been furloughed for redundancy without proper consideration.

Part of the redundancy process is considering who to place at risk of redundancy (we call this ‘determining the pool’).  I have already heard employers say something along to lines of:

“X has been on furlough for almost 18 months and Y has been covering their work.  There is nothing for X to do when they come back, so their role is redundant”.

Whilst this might make logical sense, it could lead to claims for unfair dismissal.  Putting it another way, you, as the employer, gave X’s job to Y, and are now making X redundant.  If X and Y do the same job (or very similar jobs) and now there is only enough work for one person, what you’re actually doing is reducing the number of people carrying out that role.  The correct ‘pool’ would include both X and Y (and anyone else carrying out the same role) and then you would need to decide who should be made redundant based on objective criteria such as performance.

Employers should also be careful not to disadvantage employees who have been on furlough e.g. by relying on performance data for the past year where the furloughed employee would have none or including any period spent on furlough as an absence.   You should try, as far as possible, to even the playing field between employees who have been furloughed and those who have not.  This is particularly the case as many people were furloughed due to ill health/shielding or childcare issues.  This means that many of your furloughed employees may be disabled or women, and any redundancy selection criteria which disadvantages them may give rise to a claim for indirect discrimination.

The takeaway here should be that redundancy of previously furloughed employees can be complex.  If you are unsure, you would always be well placed to take specific, tailored advice on the procedure to follow.

Should you have any queries about the issues raised in this article, or on any employment related matter, please contact our expert Arvin Sandhu by email or on 01494 893 542.