Redundancy

Good morning and welcome back to your weekly case law update. We hope you had a good Easter and enjoyed the chocolate and time off. When Bank Holiday weekends come around, it is easy to understand why some people are clamouring for a shorter working week! Anyhow, last week we looked at ACAS Early Conciliation, this week we will be looking at trade union membership and redundancy.

Section 98(4) of the Employment Rights Act 1996 states that deciding whether a dismissal fell within the range of reasonable responses depends on the size and administrative resources of the employer. For redundancy scenarios, this will affect whether the redundancy consultation and selection process were reasonable.

The questions this week are:

In a redundancy exercise, will not allocate a Trade Union representative to a new role amount to unfair dismissal?

During redundancy exercises, is there a difference between allocating staff to a newly created role and deciding which staff to make redundant when the number of existing roles decreases?

Ms Green, the Claimant, worked in the planning and development department of Barking and Dagenham Council, the Respondent. The Claimant was a highly qualified employee and worked in a team of three with two other employees doing the same role as her. The Claimant was a longstanding member of Unison and had become a trade union steward at the Respondent.

The Respondent began restructuring its workforce and initiated redundancy consultation with the Claimant’s department. The three existing positions would be deleted and the Claimant’s team would compete for two newly created roles which were very similar to the existing role. The selection for the roles would be done via an unseen test and subsequent interview.

The Claimant criticised the process, and, in her role as trade union steward, organised a campaign against the cuts across the Respondent’s workforce. The Claimant failed to make it clear whether the criticisms of her own redundancy process were from a trade union or employee perspective.

The Claimant scored the lowest combined score on the unseen test and interview and was therefore not assimilated into either of the two new roles. However, the Claimant argued that the employee who scored highest had prior knowledge of the unseen test because she had worked on the project it was based on.

The Claimant brought claims relating to unfair dismissal due to redundancy and automatic unfair dismissal in relation to trade union activities. The ET rejected the claims. It held that there was no evidence to suggest the reason the Claimant was not selected for the new role was due to her trade union affiliation.

In terms of the redundancy process, it found that the question was not why the Claimant had been selected for redundancy but why she had not been appointed to the new roles. It added the Respondent had appointed the most suitable candidates based on their selection scores.

The Claimant appealed both parts of the claim and the EAT allowed part of the appeal. It agreed with the ET that there was no evidence to suggest trade union involvement was the reason for redundancy.

Regarding the selection process, the EAT held that the reduction of three jobs into two was part of the restructuring, but it was not the creation of a new job but rather a reduction of the number of roles. It held that the decision to make the Claimant redundant may not have been a reasonable response following the correct procedure and the claim should be re-heard by a new ET.

The takeaway points:

No, you cannot use an employee’s trade union affiliation as a reason to make them redundant. However, trade union reps can be made redundant if they are selected fairly.

Yes, there is a subtle difference between allocating staff to newly created roles and selecting staff to remain in a dwindling number of roles. For the former, the employer has a greater degree of flexibility in selection based on their own opinion, in the latter, the employer must follow a more rigid selection process.

Another point from this case is that the EAT found that ET judges should clearly lay out their judgments including findings of fact, issues to be decided and reasons for the decision. In this case, the ET had not gone into enough detail about why it found the redundancy to be fair which is the reason the case has been sent back to a new ET.