How to: Discuss potential redundancies


By Kate Palmer, HR Advice and Consultancy Director at Peninsula Business Services.

While 2020 is almost behind us, the repercussions of the pandemic are still reverberating through many industries. The name of many of these harsh consequences is sadly well-known to the hospitality industry; redundancy.

No-one likes to consider redundancies, however, it’s sometimes unavoidable or necessary for the survival of a hotel, restaurant or bar.

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If push ever comes to shove and redundancies start getting served up, it’s wise to consider approaching experts for redundancy advice. But before it comes to that, it’s worth asking yourself some important questions.

  1. Is redundancy truly the last option available to us?
  2. Who would be the fairest choice for a redundancy?
  3. How do I bring this topic to the table with my staff?Yeah

Whether you’re running a large hotel or you’re responsible for a humble restaurant, these questions are all vital and should be considered seriously. Redundancies should never be made lightly.

That’s why we’ve explored how to talk to staff about potential redundancies.

Ensure your staff are in the loop

Whether you have to make redundancies or are lucky enough to have avoided them, it’s always a good idea to keep your staff up to date. Naturally, you should make sure that you also keep any remote workers up to date.

In some cases, this is more essential than courteous, employees worried about their livelihoods are naturally going to be scared that they’ll be the ones to lose their jobs. Providing regular updates reduces the chances of rumours being spread

Talk to your employees, hear their concerns, be open and honest with them. Making sure you’re all on the same team goes a long way. This includes managing expectations and laying out any financial benchmarks.

Managing expectations and laying out financial benchmarks

While you don’t want to needlessly raise employees’ hopes, you should endeavour to walk the line between optimism and reality.

Informing your employees about revenue targets makes sure they know what your business needs to stay profitable. Being honest with how business is handling the lockdown may help your employees brace themselves if any financial benchmarks aren’t met.

If the potential for redundancies becomes more and more likely, raising these financial benchmarks will welcome opportunities to discuss redundancy pay. This is when you’ll need to reassure your employees of their rights, including their rights to redundancy pay.

Gauge how employees are feeling

As ONS data has revealed, approximately a third of the 819,000 redundancies made since the start of the pandemic is in the hospitality sector. This kind of news will cause a lot of stress for your staff. When talking to your employees about redundancies, consider doing so either:

  • One-to-one: this approach can be used if you’re only discussing potential redundancies with employees you’re considering for it, or with every employee to give them proper time to discuss redundancies with you. Broach the alternatives to redundancy, hear their opinions and allow them to talk through their concerns with you.

    By team/department: allowing management or line managers to address their teams or entire departments helps to assure employees that they are not being singled out. You can discuss alternatives to redundancy, openly state the likelihood of redundancies and address questions your team or department may have.

    Company-wide: an open, honest email to everyone within your company or a company-wide meeting can address worries and concerns all at once. Be sure to make it clear that your employees can discuss redundancies with someone further if they want to.

Outline support systems available

If redundancies start becoming the centre of conversation more frequently, discussions should include what kind of support is available in the event of redundancies. One of these support systems is an employee assistance programme (EAP). They are designed to support employees with confidential and professional help.

EAPs aren’t just available for those who are made redundant. Some employees may need support for a variety of reasons, such as feeling frustrated for picking up the work their co-workers would normally do. There’s also a chance that your employees may be worried by the entire redundancy process, losing faith in your business or feeling guilty that they’re still working instead of others.

Remind your staff of support systems you have in place and also how to access them. People can feel uncomfortable asking for this information as it forces them to disclose their need to use the service.

Consider legal proceedings when talking to staff

When considering potential redundancies, ensuring that any decisions are made fairly is essential. After all, if a redundancy was deemed unfair at an employment tribunal, you could have to pay out compensation you can’t afford.

When talking to an employee, keep the conversation open and clear. Raise points such as:

  • Why you’re considering redundancies.
  • Who may be at risk of redundancy, along with how many are at risk.
  • Details about how to fairly calculate redundancy pay.
  • Any details of external agencies working to aid the process.

As long as you have clear, fair reasons for your decision, the process should be as fair and smooth as possible.

The decision process itself should be handled carefully though. This is why you’ll have to objectively decide who to make redundant. To do so you’ll need to:

  • Decide upon and communicate the criteria you’re choosing to apply. This way employees will have the ability to fairly influence the decision process.
  • See if you have an existing collective agreement or contractual procedure governing selection criteria.
  • Ensure that you have as many objective criteria as possible, such as relying on employee appraisals.
  • With these objective criteria, make it clear that any subjective criteria aren’t influenced by personal opinions, such as choosing an unpopular member of a team.
  • Never make the assessment alone; always ensure that more than one person carries it out and makes the final decision.

Other essential factors to remember when discussing potential redundancies, either as management or with employees, is to consider the likes of employees taking time off and how a business can restructure in the future.

Explore alternatives

There have been shocking reports revealing that up to one-third of all furloughed hospitality workers are at risk of being made redundant. While the government has recently announced that furloughing measures will extend to April, this is still a daunting notion.

This makes the prospect of alternatives to redundancy all the more important to inspect. Some alternatives include the likes of:

  • Redeploying and/or retraining employees
  • Job shares
  • Flexible shifts
  • Recruitment freezes
  • Overtime freezes
  • Voluntary career breaks or redundancy
  • Early retirement

These alternative options roughly take the form of halting an employee’s progression in the company, or the progress of a company as a whole. Some of these explore adapting an employee and their skillset to new roles and challenges, others request voluntary action for short term or long term relief.

Whatever option is considered is surely a much more palatable alternative, rather than making someone redundant.

It’s never comfortable making tough decisions about redundancy. However, by discussing the potentials of them clearly with your employees you can work towards either a more amicable alternative or, failing that, a smooth redundancy process.

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Zoe Monk

The author Zoe Monk

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