Business clinic: Dairy redundancy with housing issue

Q. I am a dairy farmer thinking about getting out of milking. I have 200 cows and employ a herdsman. He has been with me for about five years and I provide accommodation for him and his family.

He is on a month’s notice. I have not discussed this with him but it’s obvious that the current position cannot go on forever.

If I go down this track then I will get out of milking completely. I have to give my milk buyer 12 months’ notice. What are my obligations towards my herdsman and how do I go about this redundancy?

In terminating the employment of your herdsman, you’ll need to make sure you have a fair reason and follow a fair process in order to avoid the risk of an unfair dismissal claim, which could result in your employee being awarded up to a year’s salary if he’s successful.

It certainly sounds as though the work your herdsman carries out will be ceasing, or at least diminishing, by the time your milk contract comes to an end, and therefore the fair reason for his dismissal will be redundancy. 

See also: Advice on negotiating pay and terms with farm staff

Before terminating his employment, you will need to embark upon a process of consultation with your employee, meeting with him face-to-face at least once in order to discuss why you’re proposing to make his role redundant and to consider together whether there are any alternatives to redundancy.

Peter Cusick
Head of agriculture
Thrings Solicitors

The meetings that form part of the consultation process are formal meetings at which your employee is entitled to be accompanied by a colleague or a representative, if he wishes.

You should invite him to these meetings by way of a letter so that you can explain this entitlement.

It is good practice to take notes at all of these meetings in case you require evidence of what was discussed.

Once you’ve have had a period of consultation following the first meeting and considered any suggestions made by your employee as to ways of avoiding his redundancy – such as whether there are any jobs on the farm that he could be considered for – you should meet with him again and confirm his redundancy.

You will need to tell him the date on which his employment will terminate and what his entitlements to notice, untaken holiday pay and a statutory redundancy payment are.

His redundancy payment is based on his age, length of service and weekly wage, and you can use www.gov.uk’s online tool to calculate this.

You should confirm all of these details in writing and advise your herdsman of his right to appeal the decision.

I note your employee has been working for you for about five years and that you say he’s on a month’s notice. In fact, if he’s worked for you for five complete years, then he’ll be entitled to five weeks’ notice in accordance with his statutory minimum entitlement under the Employment Rights Act 1996. This overrides any lesser notice period agreed or set out in a contract.

You should consider when will be the most appropriate time to begin consulting with your employee.

Giving notice on the milk contract will inevitably arouse his suspicion and therefore you might want to be open and honest with him about the impact on his role, albeit you’ll probably still require his services for at least another year.

On the other hand, if you begin consulting at an early stage and serve a longer-than-necessary notice period, he may leave sooner of his own volition and leave you high and dry.

You could consider offering him an incentive payment (payable when his employment actually terminates) to stay with you until his role is actually redundant, be that upon the expiry of the milk contract or the eventual sale of the herd.

Assuming your herdsman is not living in farm accommodation under an Assured Shorthold Tenancy, he is likely to have security of tenure as an assured agricultural occupier.

Unfortunately, this security will continue notwithstanding the termination of his employment. If he refuses to vacate, the only way you’ll be able to obtain possession is through a court order and proving a ground for possession.

This may include an unreasonable refusal to move to suitable alternative accommodation or allowing the interior of the property to fall into disrepair or non-payment of rent, if you impose a new rent on your former worker.

If you’re happy for him and his family to continue living there, you can allow him to do so, albeit with the ability to charge him a market rent for the property.

Alternatively, if you require the property in order to house another qualifying agricultural worker, you’ll need to apply to your local council in order to ask them to find him suitable alternative accommodation.

Although this sounds complicated, if he goes on to find new employment on another farm, he may well be offered new accommodation as part of that job, and move out of your property voluntarily.

The information provided in these articles does not constitute definitive professional advice and is provided for general information purposes only.