Some businesses in the United Kingdom may feel a financial pinch from the new government’s budget, but they could still face unfair dismissal claims if cost pressures alone are used to justify job reductions, McGuireWoods London partner Daniel L. Peyton wrote in a Dec. 17, 2024, article in Personnel Today.
Recently, 82 CEOs of the UK’s largest retailers predicted that proposed increases in the minimum wage and national insurance contributions will make redundancies — layoffs, in American parlance — inevitable. Peyton, an employment lawyer and managing partner of McGuireWoods’ London office, warned that financial pressures don’t eliminate the need for a fair redundancy and redundancy consultation process required by UK law.
“These factors make it very difficult for employers to make the commercial and selection decisions required, solely on the basis of cost alone, without exposing themselves to unfair dismissal and other claims,” Peyton wrote.