Legal Advice · 22 March 2021

How long after making someone redundant can you replace them?

How long after making someone redundant can you replace them?

There are many reasons to make someone redundant. New technologies might have reduced the need for manned operations, the job might have been completed or might have changed into something else over time, or there simply isn’t enough money in the budget to keep on the number of staff you had. No matter the reason, redundancies happen and are a normal part of business. Provided you handled the redundancy well and followed all the legal requirements, there is no problem in making people redundant.

Difficulties can arise, however, if you want to hire someone into your business shortly after making someone redundant. Especially if the new role you are filling looks the same as the one you just made redundant.

“Replacing” a person or role immediately suggests that the person or role were not redundant to begin with. Redundancy refers to something that is no longer necessary or useful or that has become superfluous. If you immediately “replace” a person who has been made redundant and the job role looks the same then you could be charged with unfair dismissal.

The government website clearly states that “for a redundancy to be genuine, you must demonstrate that the employee’s job will no longer exist”.

The good news is that there are ways to use redundancy to help your business while still making sure every role is filled and your business can run smoothly. In businesses restructuring, roles do change and although someone might feel replaced, there is often a clear need for a different person if the role has changed to match the restructuring.

We look at some of the laws around replacing people and what you need to know about redundancy and rehiring.

 

Can you make someone redundant and then replace them?

Although you cannot make someone redundant and then replace them with someone fulfilling the exact same role, you may be able to replace them in a similar position. The contract must look different and there must be discernible and reasonable changes that require the redundancy and refilling of the position. This could include:

  •       Filling a new role with someone less skilled and on lower pay, for example, if you want to offer the position as an apprenticeship
  •       A new role with a different title that requires more experience or training (this is more common in restructuring)
  •       A role that is similar but has additional requirements
Something you must bear in mind is that if the job description for the new job is close to the job you are making redundant, you are legally required to offer the position to the person you currently employ. Even if they are over-qualified or seem to be lacking in some area. It is your responsibility as an employer to try and ensure your employee’s retention. You may even find that your employee has done additional training or added to their CV without you knowing it while they were working for you. Failure to offer an employee the chance to apply for a similar position can result in an unfair dismissal charge and legal fees you could have avoided.

Our top advice: don’t refer to someone as being “replaced”. This automatically suggests that their role was filled by someone doing the same thing.

 

How long before you can replace a redundant position?

If you do find yourself in a position to hire someone after making someone redundant, there are no legal requirements for how long you wait to fill that position. You could start advertising immediately provided you have followed all the proper channels for making your redundancy decisions.

Care should always be taken when rehiring to make sure you mitigate the risk of unfair dismissal allegations. It is not uncommon for disgruntled previous employees to seek revenge and take their employers to court. Redundant employees have three months in which to make a claim to the Employment Tribunal, so many businesses wait until this window has passed before filling any new positions.

If you start advertising for a position that looks the same, you will need to be able to adequately defend the reasons for making someone redundant and then advertising the same job and if you can’t give a defence then you could face legal action.

When you make someone redundant, be sure to work carefully to make sure you are covered if you do need to hire a similar role. If you face any unfair dismissal claims, you will need to show:

  •       That the redundancy was genuine and objective. This is to protect people from being pushed out of jobs for personal reasons
  •       The redundancy was unavoidable
  •       The ways the financial position of the business have changed to cause you to make the redundancy and then recruit new workers so quickly afterwards.
An exception can be made if you receive a new contract or grant that brings in a renewed need for a position you recently made redundant. Alternately, if the contract or grant gives your business enough money to reinstate a position. Bear in mind that you will need to show that the new business was either unexpected or uncertain enough to warrant redundancies in the first place.

 

Do I have to offer a new position to a redundant employee?

Once a person is made redundant, there is no requirement for a business to hire them back – even into a similar role. Even if your financial position suddenly changes and the exact same role becomes available, there is no legal obligation to re-hire the person who previously filled the role.

There are pros and cons to getting in new staff so you should think carefully about how you might keep on good staff. There is also an obligation until the last day of employment for you to be looking for a suitable alternative role within your organisation for anyone facing redundancy.

If you re-hire redundant staff within a week of their last day of work then their “continuity of employment” is not impacted. If they need a new contract and you would rather start afresh, you will need to wait at least two weeks before their last day of work and new start date.

If you would prefer a new hire, or if you find someone better suited to the new role, then you should offer them the job. There is no need to limit yourself to an employee who was made redundant.

 

Sign up to our newsletter to get the latest from Business Advice.


 
TAGS:

ABOUT THE EXPERT

Business development