Bumping is the practice of giving long-standing employees whose positions are to be eliminated the option of taking other positions within the company that they are qualified for and that are currently held by employees with less seniority.
It is used by employers to retain high quality employees and is often used when the company is downsizing. Often those employees who have been at the company longer and have greater skill sets are deemed more valuable.
The employee of lower seniority is made redundant. Bumping is not always the right course of action and employers should think carefully before making lower level employees redundant. Companies should ensure that 'bumping' an employee is legally compliant.