Summary: The EAT has confirmed that an employer can rely on an express contractual mobility clause to move an employee to a different workplace rather than making the employee redundant. However, it will be unfair to dismiss an employee who refuses to relocate, if the employer exercises the mobility clause unreasonably or if the employee's refusal is reasonable.
In Kellogg Brown & Root (UK) Ltd v. Fitton and another the employer relied on a very wide contractual mobility clause which said that staff could be moved to any office location in the UK or overseas, save in exceptional circumstances. The claimants refused to move from their Greenford workplace, which was being shut down, to Leatherhead. They were dismissed.
The Employment Tribunal said that the employees had been unfairly dismissed for redundancy. However, on appeal the EAT said that the dismissals, whilst made against the backdrop of a redundancy situation, were actually for misconduct - namely the employees’ refusal to comply with the instruction to move workplace. Despite this, the EAT said that the employees were unfairly dismissed because:
- the contractual mobility clause was too wide to be enforceable;
- the employer’s instruction to the two claimants to relocate was unreasonable, given their travelling time would have increased by between 20 to 30 hours a week; and
- it was reasonable for both employees to refuse to travel to the new workplace because their personal circumstances meant the change was very substantial and the various steps the employer had taken to mitigate the impact of the workplace change did little to help them.
What this means for employers
This decision is a useful reminder to employers to review the scope of their mobility clauses to ensure they are no wider than necessary. A key reason why the employer lost on these facts was because the mobility clause in question was too broadly drafted to be enforceable.
The EAT decision also highlights the general principle that there are constraints on the way that an employer can exercise an express mobility clause. Aside from giving reasonable notice of the relocation arrangements, an employer must have good reasons for making significant relocation decisions and should look at effective ways of mitigating the impact of relocation on its staff.