The Employment Appeal Tribunal (EAT) has given a judgment which analyses the right of women on maternity leave to be offered a suitable available vacancy in a redundancy situation.  The decision in Sefton Borough Council v Wainwright UKEAT/0168/14 is particularly timely, as similar rights will benefit those who take shared parental leave.  The case illustrates well how the right applies when a redundancy situation arises as part of a restructuring exercise.  In particular, it highlights the dangers of requiring someone on maternity leave to compete for redeployment into a new role.

Background

The employer decided that two positions, including the claimant’s existing job, would be deleted from its structure and replaced by a single (newly created) position. The claimant (who was on maternity leave) and the person who had occupied the other redundant position were interviewed for the new role; the claimant’s colleague was found to be the better candidate and was offered the job. No other vacancies were offered to the claimant and she was subsequently made redundant. 

Automatic unfair dismissal

The claimant's claim of automatic unfair dismissal succeded because the employer had failed to comply with its duty to offer her a suitable vacancy, where one was available (ie the newly created job). 

When does the right to be offered a suitable available vacancy arise?

Under the relevant regulations, the right to be offered a suitable available vacancy arises when it is not practicable, by reason of redundancy, for the employer to continue to employ the employee under his or her existing contract of employment. On the facts of this case, the EAT accepted that right arose as soon as the employer decided that the claimant’s existing job would be deleted, as nothing could save her job by that point. 

In this case, the redundancy situation arose as part of a restructuring exercise.  In contrast, where a redundancy exercise involves a straightforward reduction in the number of employees doing a particular type of work, without any change in the terms and conditions of employment of those who retain their jobs, there is no right to be given preference in the redundancy selection exercise and the right to be offered a suitable available vacancy is unlikely to arise until the employer has carried out a selection exercise.

What does ‘available vacancy’ mean?

Whether there is a ‘vacancy’ which is 'available' is to be determined by reference to the ordinary meaning of that word ie a vacancy is available if it is not presently occupied.  The fact that a job is only open to a limited pool does not mean that it is not an available vacancy. 

On the facts of the case, it was clear that the new post was a suitable for the claimant (she would have been slotted in automatically if she had been the only potential candidate for the job).  It was, therefore, a suitable available vacancy. It followed that, if there were no other suitable available vacancies, the claimant should have been offered the post without having to compete for it and even though her colleague was the better candidate.

What if there is more than one suitable available vacancy?

The EAT commented that if there is more than one suitable vacancy the employer does not have to offer all of the vacancies, or even any particular vacancy, to the employee who is on maternity leave.  The employer need only offer one vacancy and can choose which to offer, provided the new contract is for work which is both suitable in relation to the employee and appropriate for her to do in the circumstances and is offered on terms and conditions which are not substantially less favourable than those applying to the old job.  Therefore, if the employer in the Wainwright case had offered the claimant an appropriate job, other than the new role she was considered for, it could have avoided liability for unfair dismissal.

However, the EAT made a further point which has the potential to complicate the employer’s decision in this situation.  In deciding which of several vacancies to offer to a woman on maternity leave, the EAT suggested that if the employer does not act ‘proportionately’ by balancing the interests of other employees, it risks a claim of discrimination from those who miss out on a vacancy because of preferential treatment given to a female employee solely on account of her maternity. The effect of the EAT’s comments seems to be that if there is a (suitable) vacancy for which the claimant is the only appropriate candidate, that is the vacancy that should be offered to her in order to comply with the regulations.  However, if the employee is interested in other vacancies she should still be considered for those positions alongside others.

Discrimination

Although the claimant’s claim of automatic unfair dismissal succeeded, the EAT overturned the Tribunal’s decision that the failure to offer the vacancy also constituted maternity discrimination contrary to the Equality Act 2010. A failure to comply with the maternity regulations is not in itself unfavourable treatment because of maternity. The question in all cases is whether the reason for not offering a suitable alternative vacancy was that the claimant was on maternity leave. 

The distinction between unfair dismissal and discrimination is significant. It means that in most cases the claimant’s remedy will be confined to those available for unfair dismissal, with no compensation available for injured feelings and the amount awarded being capped at 52 weeks’ pay (or the statutory compensation cap if lower).  However, it remains possible that a tribunal could order an employer to re-engage an employee, even if that would mean somebody else might have to be dismissed, or moved, to make way for the claimant.

Sefton Borough Council v Wainwright UKEAT/0168/14, 18 November 2014