COVID-19: redundancy and failure to consider furlough
Collard v STS Storage Systems Ltd
An employee’s dismissal for redundancy was unfair, in part because the employer hadn’t considered continuing her employment on furlough. If a genuine consultation had taken place which considered furlough and the available project work, she may not have been made redundant.
Ms Collard worked as a sales administrator for STS, a small firm with nine staff. At the start of the first national lockdown, all staff were asked to work from home. When the Coronavirus Job Retention Scheme (CJRS) was introduced, three employees, including Ms Collard, were placed on furlough. Some months later the other two employees were taken off furlough and returned to work. However STS didn’t think there was enough work for Ms Collard and, there being in STS’s opinion, no other work she could do, she was dismissed for redundancy. No consultation with her took place before her effective date of dismissal. STS, after seeking advice, offered to consult with her but Ms Collard refused. She did however appeal the decision to dismiss her. Her appeal was dismissed. While the manager hearing her appeal acknowledged that STS had failed to follow the correct procedure in dismissing her before any consultation had taken place, he concluded that the same decision would have been taken in any event if Ms Collard had been allowed a consultation period. Ms Collard brought a complaint of unfair dismissal.
Ms Collard was unfairly dismissed.
STS had effectively said that any consultation would have been futile. Moreover, the letter inviting Ms Collard to the consultation did not mention that the consultation would seek ways to avoid dismissing her. Yet there were issues which could have been discussed about ways to avoid her dismissal:
- what she could have done by way of project work (which she had carried out before) and which was available, and
- whether the furlough scheme could have been used
The CJRS did not come with a prohibition on dismissal - an employer could act reasonably in deciding to dismiss as redundant notwithstanding the CJRS. However, STS gave no consideration to the possibility of continuing Ms Collard’s employment on furlough.
Had a fair procedure been followed, STS would have considered using the CJRS to avoid dismissing Ms Collard. The tribunal was not satisfied that true consultation would still have resulted in Ms Collard’s dismissal, her skill set for and willingness to carry out work available was something that could have been explored and need not have resulted in her dismissal.
In addition, Ms Collard’s dismissal was unfair because the appeal was an illusion: the appeal officer though recognising that the process to dismiss Ms Collard was flawed by the failure to consult took no steps to remedy that defect; he simply upheld the decision to dismiss.
Link to judgment: https://www.bailii.org/uk/cases/UKET/2021/3307470_2020.pdf
This decision echoes that in Mhindurwa v Lovingangels Care Ltd where a failure to consider furlough also resulted in a finding of unfair dismissal. As more cases come through the overburdened tribunal system, it is likely there will be more decisions in which a complete failure to consider the furlough scheme will result in a finding of unfair dismissal. However, if an employer did consider it and went through a proper consultation but concluded there would be no work in the foreseeable future, then simply a failure to put an employee on furlough is unlikely to result in a finding of unfair dismissal.