A procedural failure in a redundancy process is often a stumbling block for employers defending an unfair dismissal claim. The recent case of Mogane and Bradford Teaching Hospitals NHS Trust EAT 139 2022 is a stark warning to those employers who adopt a selection pool of one in a redundancy situation. The Employment Appeal Tribunal (EAT) has emphasised the importance of meaningful consultation at the outset of a redundancy process and that a pool of one may be unfair without consulting with the affected employee first.
A band six nurse was placed in a redundancy selection pool of one because her fixed term contract was due for renewal. Her colleague, also a band six nurse, was not included in the pool because her fixed term contract had been recently confirmed. The employer consulted with the employee following her selection but the Claimant’s role was made redundant. She was dismissed after she refused unsuitable alternative employment.
The Employment Tribunal concluded that there was a legitimate redundancy situation due to the financial situation in the nurse’s unit. It found no fault with the selection process and that the selection pool of one was appropriate in the circumstances.
The Claimant argued that there was no genuine or meaningful consultation because the employer had not discussed the selection pool with her, nor had there been consideration of whether the other band six nurse should have been in the pool. The facts showed that the decision to make the nurse’s role redundant was taken after she was placed in the pool. The employer responded there was no rule that consultation had to be at the very outset of the redundancy situation, or at every stage of the process.
The EAT disagreed with the lower court on the facts of the case. The employer had effectively sealed the nurse’s fate of dismissal by placing her alone in the selection pool because her contract was due for renewal. It was not in the band of reasonable responses in the absence of consultation to adopt one criterion which decided the selection pool. It was inevitable that her role would be made redundant in the circumstances, and the employer had in fact made the decision to make her role redundant prior to consultation. The EAT stated that the method of selection was a breach of the implied term of trust and confidence.
The EAT referred to key redundancy law cases. In particular, it referred to Williams v Compair Maxim Ltd  ICR 156 and the guiding principles relied upon in collective redundancy cases. It considered there was no reason that these principles could not be applied in ordinary unfair dismissal cases.
- fair warning of impending redundancies which includes possible alternative solutions and alternative employment;
- agreement with the union on the criteria for selection of “at risk” employees. Following selection, the employer and union will consider whether the selection is in accordance with the criteria;
- the selection criteria should be objective as far as possible for example, attendance, efficiency at the job, experience, or length of service;
- the employer will seek to ensure that the selection is made fairly in accordance with these criteria and consider any representations;
- consideration of alternative employment.
Judge Beard stated: “…the formative stage of a redundancy process is where consultation ought to take place according to the principles in Williams and the cases developed from it. The reason for consultation to take place at a formative stage is because that means that a consultation can be meaningful and genuine. That must mean that consultation, for a process to be fair, should occur at a stage when what an employee advances at that consultation can be considered and has the potential to affect the outcome.”
“…the question that the tribunal must answer in terms of reasonable responses is not just, is there a rational explanation for this pool? But the question: is it a pool that a reasonable employer could adopt in all the circumstances? ….In all contracts of employment there is the implied term of mutual trust and confidence. That must mean that an employer will not act arbitrarily between employees. That requirement, it seems to us impacts on a decision as to selection pool.”
Whilst the Claimant’s claim in this case was upheld on its facts, it does not always follow that a redundancy selection pool of one will never be fair. There are no hard and fast rules regarding what constitutes a selection pool which will depend on the factual situation. A selection pool of one is likely to be appropriate where there is only one person who carries out a particular role which is no longer required. However, this may not always be clear cut and there may be complications where other employees carry out similar roles or where employees have transferrable skills. In these types of situation, consultation about selection at the outset is likely to be necessary to help avoid an unfair dismissal finding.
The material contained in this article is provided for general purposes only and does not constitute legal or other professional advice. Appropriate legal advice should be sought for specific circumstances and before action is taken.
© Miller Rosenfalck LLP, October 2022