Lauren Hannath (Hodge Jones and Allen Solicitors)
During a restructure an employer may offer to demote an employee as an alternative to a dismissal for reason of redundancy. Depending on the circumstances, a demotion may be beneficial to both parties.
A demotion generally involves an employer changing an employee’s role which results in less responsibility, reduced seniority and/or reduced pay. However, it is crucial that employers tread carefully if they choose to take such action and ensure they act lawfully when making any such contractual changes.
Demotions commonly occur in situations involving poor performance, misconduct or restructure/an alternative to redundancy. The current climate resulting from the pandemic is undoubtedly causing many employers to restructure and/or make redundancies and this includes reassessing existing positions within the organisation. Employers are often keen to retain valued employees as this also has the benefit of avoiding the costs involved in recruiting and training new staff.
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