The case of Sandford & Anor v Newcastle Upon Tyne Hospitals NHS Foundation Trust followed a decision by an NHS trust to re-band 22 employees following the introduction of Agenda for Change in 2004. All employees were reduced by one pay band, although 20 of the employees accepted an offer of two years' pay protection in return for accepting the changes.

The two remaining employees rejected the re-banding and their employment was terminated on notice with an offer of re-engagement on the lower band, without pay protection. They were re-employed on those terms.

The two employees claimed that they had been unfairly dismissed from their original posts. Their claims were dismissed by an employment tribunal who found that the trust had established some other substantial reason for the dismissals and, even though it had not consulted with the trade union or the employees in breach of the Agenda for Change procedure, the dismissals fell within the band of reasonable responses and were fair.

The employees appealed against this decision but the Employment Appeal Tribunal (EAT) rejected their appeals. In particular, the EAT placed importance on the following three factors that the trust had taken into account when dismissing the employees:

  • 91 per cent of affected employees accepted the new terms
  • The trust had reasonably explored all alternatives to dismissal before dismissing the two employees and the trust's disciplinary process itself was not criticised
  • It considered the lack of trade union opposition to the proposed changes

This case, therefore, provides some helpful pointers as to the factors to take into account when re-banding employees and proposing new terms of employment.