In 2008, the recession hit the main markets to which Xejn Limited exported its products, namely South Asia. As a result, orders were reduced dramatically. The company had a workforce of over 300 people. Management introduced a four day week but even this measure did not significantly improve the company’s financial position. The management of Xejn Limited had no alternative but to reduce the workforce of the local plant by 50% in order to improve its financial stability and ensure that the company did not close down.Required:

(a) Explain whether the management of Xejn Limited can terminate the employment of half its workforce on the grounds of redundancy. (4 marks)