Why courts punish firms snubbing staff in layoffs

Redundancies, while challenging, are sometimes necessary to ensure sustainability. FILE PHOTO | SHUTTERSTOCK

In the dynamic business realm, organisations often navigate turbulent waters where they make tough decisions for the greater good. Redundancies, while challenging, are sometimes necessary to ensure sustainability.

The essence of exceptional leadership dwells in the practice of engaging in staff consultations during the intricate redundancy process. Inspired by the Kenyan legal case, The German School Society & another versus Ohany & another (2023) eKLR, this practice embodies collaboration, empathy, and foresight.

Regarding this case, The German School Society established an employment agreement with Ohany in 1995. On July 11, 2014, Ohany’s employment was concluded due to redundancy.

Ohany contested the process in court, spotlighting the lack of consultations post-redundancy notice.

The Court of Appeal delivered a verdict in July 2023, underscoring that the act of notifying the staff or the employee’s representative initiates collaborative discussions.

Judicial focus on comprehensive employee consultations during redundancies is evident. The pivotal role of these consultations first surfaced in the Court of Appeal ruling in the case of Kenya Airways Limited v Aviation & Allied Workers Union Kenya & 3 Others (2014) eKLR.

In this case, it was pointed out that consultations play a crucial role in upholding substantial fairness within the redundancy process.

This underscores consultations’ importance in ensuring substantial fairness and weighing mitigating factors. Depth, inclusivity, and meaningful engagement are imperative, reflecting dedication to both fairness and legality.

Transparency is the bedrock of the consultations. It is important to communicate to the employees the reasons for the redundancies, the selection criteria, and the anticipated impacts on staff and the business. Openness from the outset helps dispel uncertainty and minimises the spread of misinformation.

Consultations enable organisations to present the economic factors or business strategies driving the redundancies, nurturing trust and understanding even in challenging times.

In these cases, we also discover the potency of elected employee representatives, including trade unions. They ensure that the redundancy process remains fair and equitable.

By collaborating with them, an arena is created for diverse viewpoints, unearthing innovative solutions and strengthening balanced decisions.

This collaboration is an embodiment of the organisation’s commitment to creating a workplace where fairness and inclusivity reign supreme.

Consultations foster collaborative problem-solving. Organisations can tap into the collective wisdom of the employees that serve both their mission and the aspirations of their people.

Employees hold a treasure trove of valuable insights into operational processes, customer needs, and market trends.

Consultations can be incubators for innovative solutions and alternatives to redundancies, which are beneficial to both the organisation and its employees such as redeployment, voluntary leaves, or reduced working hours.

As the pages of the earlier mentioned court cases turn, we are reminded that consultations provide an avenue to think beyond the scope of redundancies.

The cases have emphasized the importance of considering the well-being of affected employees beyond the redundancy event.

During consultations, organisations can encompass provision of support such as outplacement support, or skills development opportunities.

Feeling heard and respected can soften the emotional impact of redundancies and provide a sense of closure for the employees, even for those who may ultimately be affected.

In the grand tapestry of leadership, how organisations navigate challenges and change defines their legacy. Implementing consultations with employees and their representatives during redundancies isn’t just a legal obligation, it’s an affirmation of the organisation’s commitment to honouring transparency, prioritising fairness, adopting authenticity, and championing progress.

Organisations can uphold their reputation, minimise negative impacts on morale, and foster a culture of trust and loyalty even in the face of difficult decisions.

In an era where corporate social responsibility and ethical practices are paramount, the way an organisation handles redundancies speaks volumes about its commitment to its workforce and its enduring values.

Organisations are encouraged to heed the lessons from these Kenyan cases and lead with empathy, vision, and collaboration, and embark on a journey of enlightened leadership where consultations become a celebration of the human spirit and a beacon of organisational excellence.

The writer is a governance, risk and compliance specialist.

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