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Government announces changes to redundancy rules

The Government has announced changes to the rules on collective redundancies, including a halving of the statutory minimum 90 day consultation period before large scale redundancies can take place.

Under the changes, from April 2013 the 90 day period will be reduced to 45 days for redundancies involving 100 or more employees. In addition, legislation will ensure that fixed term contracts which have reached the end of their ‘natural life’ are excluded from the obligations governing collective redundancy agreements.

New non-statutory Acas guidance will also be introduced, with the aim of addressing ‘key areas of contention’.

Commenting on the measures, Employment Relations Minister Jo Swinson said, ‘We want to improve the quality of consultations by making sure that there are tools available to help employers manage this process fairly and successfully to deliver the best possible outcomes for all parties’.

The news has received mixed responses, with the British Chambers of Commerce arguing that reducing the consultation period will help to boost flexibility in the labour market.

However, the TUC has responded angrily to the measures, with general secretary Brendan Barber commenting, ‘The last thing we need is for the Government to make it easier to sack people’.