A Timely Reminder Of The Rules Around Redundancy

In a recent Employment Appeal Tribunal case*, the EAT decided that an employee’s dismissal for redundancy was unfair as a result of a clear absence of meaningful consultation at the formative stage of the redundancy.

There are criteria to follow when it comes to making  redundancies. Employers must:

• Warn and consult employees, or their representatives, about the proposed redundancy.
• Adopt a fair basis on which to select redundancy by identifying an appropriate pool from which to select potentially redundant employees and to make the selection against proper criteria.
• Search for and, if available, offer suitable alternative employment within its organisation.

The facts of the case:

• The employer scored the employee and his colleagues at the beginning of June 2020. The first consultation meeting then took place on 30 June 2020, followed by a 14-day consultation period..
• At the first meeting he was told he could ask questions and suggest alternative approaches to the redundancies.
• He was also informed why there was a need for redundancies.
• However, the employee was not told how he, or his colleagues, were scored against any criteria.
• The employee appealed against his dismissal, during which time he received his scores (but not those of his colleagues).

The employment tribunal dismissed the employee’s claim. Although it accepted that the employee knew nothing about his scores until his dismissal, it found that the appeal process rectified this error.

However, the EAT disagreed! It found that the absence of consultation at a stage when employees can discuss the possibility of avoiding redundancies at a time when they have the potential to influence the employer’s decision is indicative of an unfair process. Although the appeal could rectify the missing information (in this case, the scores), it could not rectify the missing consultation at the time when the employer was still making up its mind.

What should they have done?

• The employer should have started the consultations at the beginning of June 2020 instead of waiting until after the scoring exercise was undertaken and the decisions were all but made..

This is a reminder to employers that you must start consultation while any redundancy proposals are still at an early stage, and that you can’t fix everything with a robust appeal. Otherwise, you can be found liable for unfair dismissal, which can prove costly.

Need any further help? Please take a look at our guide on redundancy

* De Bank Haycocks v ADP RPO UK Ltd