Restructuring a business that may result in employee redundancies is a complex process, thwart with all kinds of problems that could result in significant employment liabilities being incurred.
This is even more difficult when a small number of redundancies need to be made from a larger group of employees, all doing the same or similar roles.
Recently the Employment Relations Authority ordered an employer to pay $16,000 in compensation purely because they incorrectly applied a selection assessment criteria.
Frequently Asked Questions.
What is a “selection assessment criteria”?
The selection assessment criteria identify the core attributes associated with the roles being restructured and enables a valid assessment on each employee to be completed.
The selection criteria must contain a robust rating scale to enable assessment across the employees to be completed, at each of the defined attributes.
The completion of the selection assessment criteria process will result in each employee being assigned a total score, with the lowest scoring employees potentially then being the ones to have their roles disestablished.
Do we have to show the employees the selection assessment criteria we are planning to use?
As in the Case stated above, the failure to present the selection assessment criteria to the employee during the initial consultation process, resulted in a significant compensation payment being made.
The proposed selection criteria, and how this is going to be rated, therefore becomes one of the issues that an employee must be consulted on, within the wider restructuring consultation process.
Is the employee allowed to see how we have rated them against the other employees?
Yes – however there are issues associated with privacy that also need to be addressed. An employee is entitled to see their own rating score, and how this ranked in comparison to the other employees also being assessed, but they are not entitled to know which employee each of the other assessment results relates to.
Similarly, if more than one assessor is completing the rating matrix, the employee is not entitled to know how each assessor rated them individually. The total score obtained across all assessors is the result used to make final restructuring decisions.
When do I need to use the selection assessment process?
A selection assessment criterion must be used when a restructuring consultation process involves two or more employees who undertake the same or similar work.
When do we complete the selection assessment process?
As the selection assessment criteria are subject to consultation, the assessment can only be completed once all feedback has been received and thoroughly reviewed, and the decision to proceed with the proposed restructure has been made.
As was seen in the highlighted case study, although the employer did initially consult on the selection assessment criteria, the fact that they then used a different assessment process to make the final decision is what ultimately was their downfall. This case demonstrates how difficult it is to get the entire restructuring process correct, and particularly how small errors in one element (the assessment process) can override all the good work completed in every other step of the process.
Can Russell Drake Consulting assist in the development of a robust selection assessment process?
Russell Drake Consulting has extensive experience in developing a selection assessment process, along with a selection criteria and is able to advise the client through the process.