This week both Boots and HSBC have announced restructures of their respective businesses. As a result there are likely to be a large number of redundancies. Boots has estimated that it will be making around 900 redundancies at its head office with HSBC expected to make 1,400 employees redundant from its head office and support staff jobs across the country.
Boots CEO Mr Richard Baker stated that "the proposed changes would reduce complexity and costs of head office functions, which improves our ability to compete". It is understood that the job cuts will be achieved over six months with full-year savings of £39 million.
HSBC said the cuts were needed to help it remain "competitive" in the face of tough economic conditions and rising costs including taxes and pensions contributions.
Boots and HSBC are likely to be able to demonstrate that there is a genuine need to restructure. However, they will both be under a duty to do everything reasonably possible to avoid a redundancy situation by considering whether there are any suitable alternative vacancies for the employees within other areas of its business.
Boots and HSBC may consider, for instance, the impact of the restructure by offering voluntary redundancy packages and early retirement.
Employees whom are dismissed and have above two years service will be entitled to, at the very least, Statutory Redundancy Pay (SRP). If the employee does not have at least two years service they will not be eligible for SRP. However, upon dismissal all employees are entitled to payment of all outstanding wages and any accrued but unused holiday pay. Notice pay may also be available if the employee is placed on garden leave and therefore not required to work this period or paid in lieu of notice.
Large redundancy consultations are a difficult and stressful time for all involved. Stephensons have a dedicated team of specialist advisors who can advise and assist both employers and employees through the process as a whole. If you have any concerns please do not hesitate to contact us on 0333 344 4772.
By employment law solicitor, Laura WIlson