During economic crises and dark periods, employers are sometimes forced to restructure or lay off a large number of employees. When these layoffs reach the legal thresholds, in particular in terms of the number of layoffs, the timeframe within which they are pronounced and the size of the company, it is a mass redundancy.
The employer must comply with the formal consultation procedure as soon as he or she plans to proceed with a mass redundancy. If the employer does not comply with this procedure, he/she risks having to pay compensation for wrongful termination to each of the dismissed employees in the event of legal action.
Before proceeding with a mass redundancy, the employer must consult the employees or the employees’ organization. This must be done in good time. If the employer proceeds with the consultation of his or her employees after he or she has already made the decision to dismiss them, the dismissals may be qualified as wrongful.
The employer must communicate in writing all relevant information concerning the mass redundancy.
The purpose of a social plan is to prevent or mitigate the consequences of a mass redundancy for the employees concerned. All kinds of measures can be considered. They must respect the principle of equal treatment. For small companies, a social plan is optional.
Large companies must negotiate a social plan if they have more employees than the minimum number required by law. Whether the employer must negotiate with the employees, the employees’ organization or a trade union will depend on the specific situation of each company.
If the parties cannot agree on the conclusion of the social plan, they will have to turn to an arbitration court.
In the context of a mass redundancy, the situation and the relationship between employer and employees can be tense. If the negotiations on the redundancy plan get bogged down, the social dialogue may break down or, in serious cases, employees may go on strike.
There are solutions within the framework of the mass redundancy procedure. The employer can turn to the competent authorities to re-establish dialogue with the employees and put an end to the strike.
When the conclusion of a social plan is mandatory but the parties cannot agree, an arbitration court can intervene and decide on a social plan.