The recent Employment Appeal Tribunal (EAT) decision in the case of Mogane v Bradford Teaching Hospitals reminds employers that the redundancy process can be fraught with difficulty, particularly when it comes to choosing selection criteria and the pool of potentially redundant employees, which in this case was a pool of one.
Ms Mogane was a nurse who was dismissed by Bradford Teaching Hospitals (BTH) by reason of redundancy. She had worked for BTH as a band-6 nurse in a research unit since 2016, on a series of one-year fixed term contracts, the last of which was due to expire on 1 June 2019. Another nurse was engaged on a two-year contract, with an expiration date later than that of Ms Mogane’s contract.
When BTH decided to reduce the number of band-6 staff to cut costs, it chose Ms Mogane on the basis that her contract would expire earlier than that of her colleague. Redeployment options were considered, but no suitable alternatives were available, so the redundancy proceeded at the end of her fixed-term contract.
Ms Mogane argued in the Employment Tribunal (ET) that her dismissal was unfair on the basis that BTH had failed to carry out any consultation, or consider alternatives to basing its redundancy decision on which nurse’s contract would expire first. The ET dismissed her unfair dismissal claim.
The EAT upheld Ms Mogane’s appeal and concluded that her dismissal was unfair. Key points from the decision were as follows:
- The principles of fairness which apply to collective redundancies should also be applied to individual redundancies, with adaptation.
- For a redundancy process to be fair, consultation should occur at a formative stage when it could be meaningful and genuine and when the employee’s views had the potential to affect the outcome.
- An ET should consider whether the employer’s choice of redundancy pool was a pool that a reasonable employer could adopt in all the circumstances. The employer must not act arbitrarily between employees, including in relation to the selection pool.
Applying these principles to Ms Mogane’s situation, BTH had made an arbitrary choice to focus on a single selection criterion which resulted in a pool of one employee. The decision to select Ms Mogane as redundant had essentially already been taken by the time it was discussed with her, so subsequent consultation was meaningless.
The case has been remitted to the ET to consider remedy for Ms Mogane.
Key takeaways for employers
The EAT emphasised the importance of genuine and meaningful employee consultation with a potentially redundant employee, at a stage where the consultation can potentially influence the outcome.
If an employer intends to rely on limited selection criteria which will earmark a single employee for redundancy, despite the fact there are other employees in comparable roles, the consultation should cover the use of those limited criteria before they are applied. In particular, the employer will be expected to consider whether this is a reasonable approach and to take account of the employee’s views.
A less risky approach would be to use several objective selection criteria, against which comparable employees are scored and provisionally selected for redundancy. Common criteria might include for example: performance and skillset, relevant experience, disciplinary record, absenteeism, and future potential. The process should be fully explained to the relevant employees, and their views considered so far as possible.
A transparent and objectively fair redundancy process which reflects this approach (and is supported by a paper trail) is far less likely to result in a successful claim for unfair dismissal.