In the case of Aylward v Glamorgan Holiday Homes (2003), the EAT held that a reduction in the number of employees performing work of a particular kind was necessary for a redundancy situation. This decision was widely criticised, and has now been rejected in Packman t/a Packman Lucas Associates v Fauchon.

Ms Fauchon was employed as a bookkeeper. Due to a downturn in business and the introduction of new software, Packman requested that Ms Fauchon reduce her weekly hours. Following her refusal to do so, she was dismissed. In her subsequent tribunal claim for unfair dismissal, there was a dispute over the reason for her dismissal. Packman contended that it was not a redundancy because there was no reduction in headcount. However, the tribunal held that the proper test is whether there has been a reduction in the need for employees to carry out work of a particular kind. On this basis, Ms Fauchon had been dismissed for redundancy.

The EAT confirmed this approach, emphasising that a reduction in headcount is not necessary for there to be a redundancy situation, provided that the employee is dismissed because the employer’s requirement for particular work to be carried out has ceased or diminished. Employers should note, however, that defining a redundancy situation will still depend on the particular circumstances of each case.