Tips for choosing who to make redundant from a group of employees

When an organisation decides to make a position redundant, they often need to pick which employees to let go from a group that are performing the same or a similar role. This can be a tough decision, but using a fair and objective selection process is recommended as employers always need to be mindful of any unfair dismissal risk where the redundancy is not considered genuine and of any relevant consultation requirements.  

The following will assist employers in making these difficult selections by discussing the following four step process:

Step 1: Identify the qualifications (if any) and skills required for the position 

This step is particularly important as it allows employers to identify criteria that are relevant to the position and the needs of the business. These criteria will usually sit under categories such as job knowledge, communication skills and teamwork. 

Employers may find this task easier by referring to the position description for the role. 

Ai Group’s  Redundancy Selection Criteria Matrix  provides a framework for Members to use, however employers will need to customise to incorporate the criteria that has been identified above. 

Issues to avoid in preparing a selection matrix  

When implementing redundancies, employers need to consider whether any aspect of the implementation process could be perceived as discriminatory.  

By ensuring that the selection criteria are objective, employers will reduce the risks that the criteria could be seen as discriminating on unlawful grounds, such as sex, pregnancy, race, age, marital status, illness or injury, family/caring responsibilities, disability and union membership.   

Risks of claims based on indirect discrimination can be minimised by ensuring that the selection criteria does not have a disproportionate impact on a particular category of employees.  

For example, implementation of a 'last-on-first-off' selection policy will have a disproportionate, and thus, discriminatory effect on female employees if newer employees were mostly female.   

Criteria such as attitude, motivation and potential are problematic as they are subjective. These items are better dealt with by converting them to objective selection criteria such as whether the employee’s work output meets acceptable standards of quality, or whether the employee adapts quickly to new tasks and processes. 

Ai Group Members can find helpful guidance regarding employees who's position may become redundant and who are on workers' compensation, parental leave, due to commence parental leave and/or of mature age in our Redundancy selection process article. 

Step 2: Identify which employees have those skills 

Once the selection criteria have been developed, the document should be given to one, or preferably more, managers/supervisors who have firsthand knowledge of the employees’ skills and work performance.  

The supervisors/managers should, independently of each other, conduct the assessments. The assessments should only apply to those employees in the roles identified for redundancy.  

It is important that the supervisors and/or managers involved are properly briefed as to their responsibilities and that they must conduct the task as fairly as possible without allowing themselves to be swayed by stereotypical assumptions or personal opinions. 

Taking unsatisfactory work performance into account 

It is important to be conscious that positions are made redundant, not the individual employee that occupies that position. Where considering if there is an operational need to make a position redundant, the employee’s performance should not be considered.  

However, where there are operational grounds for multiple positions to become redundant, and a selection process is required, an employee’s skills and performance in that role may be relevant.   

Step 3: Rank those employees in order from most to least skilled 

Once the assessments have been undertaken, they should be combined and used to rank the employees assessed. 

The total score given to each employee will determine their rank. The total score may be based on ratings only, or it might be a combination of ratings and weight.  

Where an employer decides to use the weighting scale in conjunction with ratings, the ranking method will need to be designed so that the weight given to each criterion reflects the relative value of each skill and/or qualification to the ongoing needs of the organisation. 

For example, the ability to operate across a range of functions within the organisation might be weighted higher than the ability to demonstrate communication skills relevant to the position. 

Members are encouraged to contact the Workplace Advice Line on 1300 55 66 77 for specific advice on setting up and using a ranking method.  

Step 4: Verify the result of the employer’s provisional assessment 

The results of the employer’s provisional assessment should be discussed with the affected employees to ensure that they are given the opportunity to comment on any of the shortcomings perceived by the employer or to bring to the employer’s attention other matters which might secure a more favourable result for the employee.  

These discussions will form part of the consultation process, which for many employers is a legal obligation under a relevant award or enterprise agreement. For detailed information on consultation, Members can read our Redundancy Consultation article.  

The final decision must not be made until the employer considers the responses (if any) made by the affected employees. It is important to note that considering employee responses does not mean the employer should let the employees rank themselves; it simply means listening to any concerns they may have.  

Employers are also not required to provide affected employees with a copy of the selection matrix or show this to them. 

Once the selections have been made 

Once the selection process has been completed, there will be a pool of candidates who have scored poorly in the redundancy selection matrix. It will be these employees’ positions which will potentially be made redundant. 

Employers should meet with these employees to discuss the outcome of the selection process, and consider any comments made by the employees. It is important that at this stage of the redundancy process, the employer is still complying with any consultation and redeployment obligations. 

Further information 

For assistance with your workplace matters, Members of Ai Group can contact us or call our Workplace Advice Line on 1300 55 66 77. 

Further resources to help Members manage the redundancy process can be found at the Redundancy topic of the HR Resource Centre including our  Redundancy Toolkit.