For those who love to shop, the closing of 31 House of Fraser’s UK stores will strike the heart strings – and for those who work for the 169-year-old company, the news strikes a lot closer to home.
Earlier in the month, we discussed the closure of STV2 and the employment/redundancy issues arising, showing the effect that a changing virtual landscape is having on entertainment and shopping.
Legally, an employer can dismiss fairly for reasons of redundancy where:
- A company closes/relocates, or an employer decides to shut down its business;
- A specific workplace closes/relocates, or an employer decides to close a specific workplace, such as one of its offices, stations, or factories;
- An employer no longer needs as many employees to carry out a particular type of work.
For House of Fraser, the decision to move out of its legacy Edinburgh and London HQs, and closing a distribution centre at Milton Keyes, threatens an unknown number of jobs while trying to beat unsustainable costs.
During this process, House of Fraser will have to follow a fair procedure for all its employees while they consider redundancy. The fairness of this redundancy procedure will consider all circumstances, including the size and administrative resources of the business.
If a former employee of House of Fraser were to feel their dismissal did not follow the correct procedure, an employment judge would have to decide whether House of Fraser acted reasonably in dismissing the employee (applying the general test of fairness in s98(4) of the Employment Rights Act 1996).
An employer should begin the selection process by identifying the group of employees at risk of redundancy, known as the “redundancy selection pool”, before applying to decide which employees should be retained and which will be provisionally selected for redundancy.
For a redundancy dismissal to be fair, the employer should:
- Identify an appropriate redundancy selection pool (i.e. a group of employees at risk of redundancy);
- Apply objective selection criteria to those in the pool;
a. (e.g., performance, length of service, skills/qualifications/training, attendance record, time-keeping, disciplinary record)
b. Your employer will need to be able to justify different weighting to each criteria as fair in the circumstances.
c. The selection criteria must be applied in a fair way, by an appropriate manager(s), with reference o accurate and up-to-date information and documentation.
d. Your employer cannot apply redundancy criteria that discriminate.
- Consult with individuals in the pool;
a. At the end of the consultation period, your employer will confirm whether it is making you redundant, or whether an alternative to redundancy has been found.
- Consider suitable alternative employment where appropriate, subject to a trial period.
a. Your employer is obliged to consider you for any suitable alternative vacancies that become available in the business or in any associated companies.
b. You can accept an alternative role on a four-week trial basis to decide whether it is suitable for you.
The shop workers’ union USDAW (a body not recognised by House of Frasers) has received calls from worried employees about the status of their roles in the company. Similarly, if you have been made redundant and have questions about your process, please contact the Employment Team at Jackson Boyd as soon as possible. There is a strict timebar for employment claims (three months less a day from the date of termination), so the earlier you contact, the more likely you will be in presenting a valid redundancy claim.