Why compassion in redundancy situations is vital for businesses

Redundancies can be one of the most disruptive events an organisation can face. Not only do they affect employees’ livelihoods, but they also have the potential to harm morale, productivity and the organisations reputation if they are not handled well.  

Managing redundancies with empathy is crucial. Compassionate redundancy helps reduce emotional stress, mitigate legal risks, and safeguard the company’s reputation, while also ensuring smooth transitions for affected employees.  

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

The risk of not putting people experiences at the heart of redundancy

The risk of not properly managing redundancy situations with empathy and compassion is significant and can have negative consequences, such as:

• Legal and financial risks: If the redundancy process is not handled appropriately, the business may face legal challenges from employees who feel that they have been unfairly dismissed or discriminated against. In January 2024, legislation changed, introducing a 25% uplift to compensation for employment tribunals if an organisation fails to comply with collective consultations requirements making the cost of non-compliance higher than ever.
  
  The Employment Rights Bill also considers removing the “at one establishment” from the test to determine whether collective consultations are required, meaning that larger organisations with offices or sites across multiple locations will need to consider redundancies much more strategically if they are planning of making 20 or more staff redundant.
  
  
• Reputational damage: If employees feel that they have been treated unfairly or with disrespect during the redundancy process, they may share their negative experience with others, including potential customers and employees. This can damage the organisation’s reputation and make it difficult to attract and retain talent.
• The risk to morale and productivity: If the process is not handled well and with empathy, it 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 business.

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 recognising the human element and the emotional impact of the risk to jobs, especially during these challenging economic times.During redundancy consultations, it’s crucial to communicate in a way that acknowledges and reflects the impact of the situation on the employees. Share the reasoning behind the decision and be open about the steps taken to avoid or minimise job losses, explaining how the process has been made as fair as possible. Also be clear about the process and timescales involved to minimise uncertainty. Use empathetic and sincere language to convey how much you care about the impacted employees.

   By communicating with openness and transparency, you can help to alleviate the stress and anxiety associated with redundancies and build trust and understanding among all parties involved.

1. Provide those managing the process with adequate support. Many line managers conveying the redundancy message to their teams will be facing the situation for the first time, so they will lack confidence and experience.Consider the impact on their wellbeing and productivity and provide mental health support for those involved in managing the process.

   Training and support for managing difficult conversations is essential to ensure your line managers are confident in their capability to deliver a consistent and compassionate employee experience.

3. Reduce the administrative burden so that you can focus on the employee experience. Prepare communication templates and redundancy consultation scripts that are tailored to your organisation.Outsourcing expert note-taking support for the consultation process can help to ensure that those managing the process are well prepared to focus on being present in the moment for the employee.

   Investing in technology, like the Meeting Manager solution by AdviserPlus, can help simplify redundancy consultation processes and ensure line managers involved in the process can focus on being present in the conversation with their impacted employees without the distraction of logging notes. Given the recent increases to awards tribunals can now award, making sure that the consultation processes are delivered in a compliant way is paramount.

   Download our ‘Shift happens‘ research for more information.

4. Support employees in securing the best next step. Providing expert career coaching, guidance and career transitioning resources and learning services, such as CV writing, interviewing and networking, helps to ensure a positive employee experience and demonstrates your organisations commitment to your employees’ wellbeing.Outplacement services, such as those provided by our Empowering People Group partner, Working Transitions, 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 them here if you have any questions.
5. Support those remaining in the business. Consider the broader impact on the team and those who will continue to work for you. ‘Survivor guilt’ can have a significant impact on the productivity and morale of those remaining in the business, so it’s key that line managers are equipped to communicate effectively with their wider team member.Organisations should provide training for managers to help them recognise and signpost support for those who are experiencing low morale, and offer ongoing mental health support to show the commitment to a people-first approach to redundancy management

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 situation, businesses can deliver more positive experiences for everyone involved and minimise legal risks. 

AdviserPlus, and our Empowering People Group companies, are experienced in supporting businesses through restructuring, downsizing and workforce restructures. Find out more about our suite of services that simplify redundancy processes to reduce the pain, risk and complexity. Read more here or watch this 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