Definition
Every redundancy must be based on a business decision – such as the closure of a department, the merger of divisions or outsourcing – which results in the permanent loss of the job in question. The courts do not examine whether this decision was economically sound, but only whether it is genuine and reasonable. The employer must set out in concrete terms which measure they decided upon and when, and exactly how this results in the loss of the need for the employee’s services.
Specialist solicitor in employment law
Over 15 years’ experience in employment law
Classification under employment law
Every redundancy must be based on a business decision that results in the loss of the job. The court has only limited scope to review this decision – but it must be genuine, reasonable and not arbitrary.
Distinction from related terms
Urgent operational requirements: The organisational decision is the business measure, such as job cuts. Urgent operational requirements are the legal prerequisite derived from this for a dismissal.
Social selection: The organisational decision determines that jobs will be lost. Social selection then determines which specific employees are affected.
Practical tip
Is your role being ‘made redundant’, only for a similar position to be advertised shortly afterwards or for a temporary worker to be brought in? This is a strong indication that the organisational decision is merely a pretext. Make sure you gather this information carefully.
