Canadian Aerospace Company & British Redundancy Law

canada aerospace

Amidst falling sales and financial loss globally, Canadian aerospace giant Bombardier earlier this year reluctantly announced job cuts at its plants in Northern Ireland.

This is only part of a greater series of cuts and job losses globally due to cost overruns with its C Series private jet project. Despite being given nearly £700m by the Government of Quebec, and having Air Canada order 75 of its new C Series 300 private jets, the Canadian aerospace firm saw its pre-tax profits fall last year by 40% to $554m. This downturn for the global giant was also fuelled by falling demand for luxury private jets.

The Shorts aerospace company was a leading employer in Northern Ireland since 1936, before being bought by Bombardier in 1989. It has employed many thousands across its sites. However, as Bombardier looses 7,000 jobs globally over the next few years, the troubles company announced that 580 jobs will go in Northern Ireland this year, with 500 more next year. It is estimated that nearly 400 temporary or contract workers will be the most vulnerable for redundancy.

The job cuts come at a bad time in Northern Ireland. Although official UK figures indicate a rising trend of employment, high unemployment and high house prices dominate in Northern Ireland. The job cuts will also be a severe blow to Northern Ireland’s construction and manufacturing sector and will hit families and local communities hard.

Further, the losses will see many highly qualified and skilled aerospace workers unable to find a job in the Province. As one anonymous Bombardier employee said to reporters “we can’t all answer phones in Northern Ireland. That seems to be the only kind of work available at the minute and it’s not for everyone… as we saw with the shipyard, once those skills are gone, they’re gone.”

Trade union Unite and the Northern Irish Executive have condemned the job losses. In response, Employment Minister Stephen Farry said that the job losses are “extremely regrettable, not only for those who have lost their jobs but also for the families, communities and the economy as a whole… My department will be proactive in determining what steps we can take to assist employees facing redundancy to provide them with advice and guidance regarding re-skilling, training, and alternative employment opportunities.”

Currently, there is a grim atmosphere at Bombardier’s Northern Irish plants, as many face redundancy. During this time, those employees should well remember the rights they have regarding redundancy, and that Bombardier had legal obligations to its employees regarding the job cuts.

The first key matter is that any wave of workplace redundancies has to carried out with due process under law, and with every regard to the employees affected. Additionally, any redundancy agreement or package has to carefully negotiate and agreed by both sides. Failure to do either of those or to obey the strict employment law rules regarding such dismissals could make the employer liable for a claim of unfair redundancy.

Both British law and Trades Unions recognize that, unfortunately, there are situations where companies have to dismiss many of their workforces – as with Bombardier in Northern Ireland. Those usually fall into three different categories; and. a business is closing, when a business is closing a particular site, or when a business continues to trace and operate, but (as with Bombardier) requires fewer employees to carry out the work of the business.

Any employer considering workforce redundancies, and related staff losses, claims, is required to act in a certain way prior to any actual job losses. Firstly, the employer is obliged to inform all employees of the prospect of such dismissals. Consultations must be had within the company, and with all the employees who might be affected by the job losses. If over 20 employees are going to be affected, then the company must have redundancy talks with the relevant Trade Union or elected staff representative.

In those situations where not every member of staff who performs a certain role will be dismissed, the company must ensure that an open, impartial and fair selection process is set up to choose which of the employees will actually be made redundant. Such a selection process will usually involve:

– Giving reasonable, objective consideration as to which employees should be made redundant
– Setting objective selection criteria against which to assess those employees, and carrying out any such section processes objectively
– Any redundancy selection process should be carried out absolutely objectively, and in a fashion that avoids any discrimination in either the process or criteria. For example, the traditional criteria of “last in, first out” could potentially give rise to cases of age discrimination.

After any consultations (and any selection process, if applicable), the employer should first seek to use existing employees in a different position or role within the company, if there are suitable vacancies and a business need.

Throughout the process, it is vital and a key legal requirement that detailed discussions over redundancy and any severance packages must be had between employer and employees. Any lack of such a correct procedure and process could potentially give rise to legal claims of unfair redundancy. During the discussions, in many cases, it is a legal requirement to involve the relevant Trace Union or employee organization. This can actually help in negotiating a fair redundancy package for both sides, and for ensuring that the redundancy process is conducted with the due process of employment law.

Another common source of legal claims for unfair redundancy is discrimination. During the redundancy process, the negotiations and selection must be conducted in such a fashion to avoid any perceived discrimination under the Equality Act (2010).

Although facing redundancy can be unnerving and scary – employees should be advised and made aware of their rights. Companies are required to conduct large-scale redundancies with due care and due process and in line with the law. Those legal rules often serve to protect employees rights and welfare. If there is any indication that the redundancy has been anything but fair, impartial, or not carried out with due process – then it is that employee’s absolute right to challenge it. The employee has all and every legal right to make a claim against their former employer for unfair redundancy or unfair dismissal and to challenge their redundancy and their former employer before an Employment Tribunal.

Admittedly, though, that is all little comfort to the nearly 600 facing losing their job at Bombardier this year in Northern Ireland.