The application of employment law in the workplace can often be reduced to a series of steps or processes. In a redundancy , an employer needs to consult properly, ensure pooling and selection is carried out correctly, and take steps to ensure the issue of alternative employment is addressed, as well as following the statutory dismissal procedure.
In the case reported here, the Scottish EAT upheld a decision not to award compensation in a case concerning an unfair redundancy dismissal. The Tribunal found the dismissal unfair for failing to follow the statutory dismissal procedure but awarded no compensation on the basis his employment was bound to have ended had a proper procedure been followed.
Central to the finding of no compensation was the fact that the Claimant, prior to being dismissed, had been offered alternative employment albeit at a lower salary and with a probationary period.
As the contract on which the Claimant was working had come to an end, the conclusion was inevitable.
In cases where there is a clear need for redundancies, and no issue of selection, then the issue of alternative employment is at centre stage.
Where the employer can show, as in this case, that they had addressed their mind to the problem of alternative employment and come up with an offer, then the employee’s prospects of being awarded substantial compensation are slim as effectively by declining the offer they have elected to leave employment.
There is scope for confusion as the issue of alternative employment can become conflated with the issue of suitable alternative employment. Where the employee unreasonably rejects suitable alternative employment, his right to a redundancy payment may evaporate. That issue is different to the employer’s need in unfair dismissal cases of bringing to the affected employee’s attention any alternative employment. If alternative employment has not been addressed either at all or adequately a Tribunal can then make a finding that there was, say, a 50% chance of retaining employment, and the compensatory award is predicated on that basis.
Making an offer of alternative employment can close down the Tribunal’s options as the Tribunal will know that such an offer was made and rejected.
In the case under discussion,as the offer of alternative employment made by the employer was crucial in the Tribunal’s determination of zero compensation, the question remains, why do so few employers make offers of alternative employment to redundant employees when redundancies are made?