Why compassion in redundancy situations is vital for businesses

Redundancies can be one of the most disruptive events an organisation faces. It impacts not only employees’ livelihoods, but also has the potential to harm morale, productivity and the organisation’s reputation if not handled well.

Managing redundancies with empathy is crucial. A compassionate approach helps reduce emotional stress, mitigate legal risks, and safeguard your reputation, all while ensuring a smoother transition for affected employees.

If you need redundancy advice for your organisation, get in touch to discuss how you can transform your collective consultation processes to reduce risk and ensure a people-centric approach.

The risk of not prioritising people during redundancies

Not properly managing redundancies with empathy can have significant negative consequences, including:

• Legal and financial risks: If the redundancy process is mishandled, your organisation could face legal challenges from employees who feel unfairly dismissed. In January 2024, legislation changed, introducing a 25% uplift to compensation for employment tribunals if an organisation fails to comply with collective consultation requirements. This makes the cost of non-compliance higher than ever.The Employment Rights Bill may also remove the “at one establishment” clause, meaning larger organisations with offices in multiple locations will need to consider redundancies more strategically if they plan to make 20 or more staff redundant.
• Reputational damage: If employees feel they were treated unfairly or with disrespect, they may share their negative experiences. This can damage your organisation’s reputation and make it difficult to attract and retain talent.
• The risk to morale and productivity: A process handled without empathy can lead to low morale, decreased productivity, and increased turnover among remaining employees. This results in a loss of key skills and knowledge, impacting the long-term success of the organisation.

To mitigate these risks, it’s important to carefully plan redundancies and engage with experts who can support you in ensuring they are handled compliantly and compassionately.

*The Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order 2024

5 tips for achieving compassionate redundancies

1. Communicate clearly and transparently

Keep communications simple, direct, and transparent. Show compassion by acknowledging the human and emotional impact of job losses, especially during challenging economic times by:

• Sharing the reasoning behind the decision at the right time;
• Being open about the steps taken to avoid or minimise job losses;
• Clearly explaining the process and timescales to minimise uncertainty with empathetic and sincere language.

By communicating with openness and transparency, you can help alleviate stress and anxiety and build trust among all parties.

1. Support those managing the redundancy process

Many line managers delivering redundancy news to their teams are doing it for the first time. They often lack confidence and experience. Consider:

• The impact on their well-being and productivity;
• Mental health support for those involved in managing the process;
• Offering training to help managers handle difficult conversations with confidence and compassion.

3. Reduce the admin burden and focus on employee experience

Prepare communication templates and redundancy consultation scripts tailored to your organisation and outsource expert note-taking support for collective consultations so managers can focus on being present for the employee.

Investing in technology, like the meeting manager, can simplify redundancy consultation processes for those managing the process, ensuring managers can focus on the conversation without the distraction of logging notes.

This helps ensure compliance, which is paramount given the recent increases in tribunal awards. Download our ‘Shift happens‘ research for more information.

4. Support employees in their career transition

Provide expert career coaching, guidance, and resources like CV writing, interviewing and networking skills to ensure a positive employee experience. This demonstrates the commitment your organisation has to its employees’ wellbeing.

Outplacement services, provided by our Empowering People Group career transitions partner, offer career coaching, guidance and resources for career transitions, helping organisations ensure compassion and opportunity during the transition period.

Their experts are always happy to help. Contact Empowering People Group for more information.

4. Support those remaining in the organisation

Consider the impact on the team and those who will continue to work for you. “Survivor guilt” can significantly impact the productivity and morale of remaining employees. It’s crucial to:

• Equip line managers to communicate effectively with their wider team;
• Provide training for managers to help them recognize and offer support for those experiencing low morale;
• Offer ongoing mental health support to show your commitment to a people-first approach.

Simplifying the collective consultation process

Compassionate redundancies are essential for better people and business outcomes. By putting your organisations people first, simplifying the consultation process and providing support at every stage of a redundancy process, organisations can deliver more positive experiences for everyone involved and minimise legal risks.

AdviserPlus, and our Empowering People Group companies, are experienced in supporting organisations through restructuring, downsizing and workforce restructures.

We can simplify redundancy processes to reduce the pain, risk and complexity. Read more about streamlining redundancy consultation meetings watch this ‘Compassionate redundancies’ video.
Our experts are always available if you need any advice on managing redundancies in your business. Get in touch if you have any questions.