Government launches consultation on collective redundancies

Following on from the call for evidence launched at the end of last year, the Government has launched a formal consultation on reducing the minimum consultation period before redundancies of 100 or more employees can take effect. It is proposed that the current 90 day consultation period should be reduced to 30 or 45 days on the basis that the current rules do not fit today’s economic climate as they slow down businesses ability to restructure (which is crucial in the current market) and in fact are more restrictive than many other EU countries.

The Government believes that shortening the consultation period will also reduce uncertainty for employees thereby increasing employee morale and ensuring that employees are better placed to take advantage of alternative employment opportunities.

It is also proposed that a non-statutory code of practice will be published by the Government to encourage quality consultation.

The consultation closes on 19 September 2012 and it is hoped that the responses will be published within three months of this date. Should the consultation responses support change, it is envisaged that the Government will look to introduce the changes in Spring 2013.