Alternative work and fairness of redundancy

A fair redundancy dismissal requires proper consideration of alternative employment.

Background

Mr Kennedy began working for Hendy Group, a well-known car dealership, in 2013. Two years later he moved into a role providing training for all the employer’s sales teams across its workforce. He had some 30 years’ experience in the motor trade and specifically in sales; both in respect of new and used vehicles.

In 2020 a redundancy situation arose, largely due to COVID. Mr Kennedy accepted this was a genuine redundancy situation; he also accepted that, in terms of selection for redundancy within that team, he was fairly selected for redundancy. He complained however that he’d been unfairly dismissed because no adequate, appropriate or fair consideration had been given to the possibility of him continuing to work for the employer, albeit in a different role. A tribunal agreed with him and awarded him £19, 566 compensation. The employer appealed.

EAT decision

The appeal was dismissed.

Despite the fact that there were multiple jobs available with the employer in sales in the period between Mr Kennedy being given notice and his dismissal, his employer made no efforts to identify any alternative employment. As such its approach was one which no reasonable employer would have taken.

In particular:

The HR department took no steps to help Mr Kennedy, other than telling him he could apply for jobs on the same basis as every other job applicant.
The employer took away his laptop and, with it, his access to the Intranet.
After his applications for several sales roles were rejected, the employer told him any further applications for sales roles would be unsuccessful as they questioned his motive in applying for them.
HR communicated with him via an email account he couldn’t access.
HR did not tell managers he was at risk of redundancy.

The tribunal was also unimpressed by a letter sent by internal email (which Mr Kennedy didn't receive as access had been removed), in which HR informed him that his applications for two sales roles would not be progressed as there were ‘some questions around your motivations for applying for a Sales role’ (which, on the tribunal’s conclusions appeared to have related to a desire to remain employed). The letter went on to say, ‘While we do not wish to deter you from applying for alternative roles within the group, the response will be consistent for other Sales related roles.’

Comment

This case does appear to place a higher burden on employers in circumstances where the case law beforehand suggested that giving access to vacancies is sufficient (other than when women are made redundant whilst on maternity leave, when the burden is much greater to take proactive steps.)

However, here there seemed to be a combination of factors – a large employer with lots of apparently suitable alternatives, cutting off access to the intranet, not telling managers he was at risk, not exploring what he was interested in and the email saying he would not get any sales job ever in the organisation.

Also of note is the fact that no Polkey reduction was made to Mr Kennedy’s compensation. The EAT endorsed the tribunal’s decision in this regard, holding that had the employer acted fairly, Mr Kennedy would have been likely to secure another job within the business.

When considering alternative employment, some points to consider include:

Make genuine and documented efforts to find suitable alternative vacancies within the organisation (plus associated ones and subsidiaries).
Consider delaying dismissal if it’s likely that alternative work will turn up shortly, e.g. because of new orders.
Give affected employees sufficient information about the new role and enough time to make an informed decision on whether he or she wants it. Encourage employees to take the job on a trial basis.
Do not assume that just because the job pays less or is of a lower status that the employee will not accept it.