Green v London Borough of Barking & Dagenham UKEAT/0157/16/DM
In this case, the Employment Appeal Tribunal (EAT) was asked to decide whether the test for fairness of a dismissal (s98(4) of the Employment Rights Act 1996) applied in the same way as to other redundancy dismissals where existing employees must compete for a reduced number of new roles following a restructuring, and concluded that it did.
Employers should give both union representatives and employees as much notice as possible of possible redundancies, that selection for redundancy should be based upon the application of objective criteria, that consultation should take place and that the employer must consider suitable alternatives to redundancy (Williams v Compair Maxam). The employment tribunal must decide whether the dismissal lay within the range of responses which a reasonable employer could have adopted.
The Claimant, who was also a trade union representative, worked for Barking & Dagenham Council (the Council) for about six years, and was one of three employees in her team in jobs graded at level PO6 on the Council’s structure. The Council proposed a restructuring which would mean all three existing PO6 level jobs were abolished, and two new PO6 jobs created. All three existing PO6 employees would be invited to apply for the new roles. A more junior position in the team would also be abolished and broadly replaced by another lower graded role.
After consultation, the Council went ahead with the proposals. The Council agreed up to date job descriptions with the employees affected and then evaluated them against the new roles in a job-matching process – if an individual scored more than 65%, they would be slotted into the new role, but if two or more candidates scored over 50% there would be an unseen written test and an interview to determine who should get the job. All three PO6 employees went through to the test and interview, while the more junior employee was slotted into the new lower grade role.
As the lowest performing candidate, the Claimant was selected for redundancy. The Council refused to hear her appeal against the decision not to offer her one of the PO6 roles since it was an assimilation process without right of appeal, not a redundancy process.
She claimed automatically unfair dismissal (because of her union activities) and unfair dismissal. The employment tribunal did not find that the Claimant’s trade union activities had played any part in the decision. As far as the unfair dismissal was concerned, it said that this was a case not about her selection for redundancy, but why she had not been appointed to one of the new jobs.
A previous case, Morgan v Welsh Rugby Union, had held that it was reasonable to hold a competitive interview process and appoint the best candidate for the job, even if that was judged subjectively. That case had also said that the guidance in Williams does not apply where the appointment to new roles after a reorganisation may require the employer to consider the individual’s ability to perform that new role. Therefore, said the tribunal here, it could not address the composition of the selection pool and the genuineness of any appeal, and that even if she had not been made redundant at the end of this restructuring, “she was unlikely to have survived the next [round of cuts, which were at proposal stage].”
The Claimant appealed to the EAT, which said that Morgan simply states that the guidance in Williams does not apply in the circumstances of that case. It is clear that employment tribunals should have the usual test of fairness firmly in mind at all times when considering any dismissal. The tribunal must review the decision made, the process followed, and decide whether each stage fell within the range of reasonable responses.
The EAT felt that the situation here was closer to a reduction in the number of existing roles than simply choosing the best candidates for the new roles, but said that it was still possible the Council’s decision was fair; however, the tribunal had failed to demonstrate that it had applied the reasonable range of responses test to each stage of the Council’s decision-making. The appeal was allowed and, since the EAT found the tribunal’s decision to be so fundamentally flawed, remitted to the employment tribunal to be heard afresh by a new judge or panel.
What to take away
The EAT is clear that tribunals must always consider whether the dismissal is fair in all the circumstances and within the range of reasonable responses. There is a difference between appointing employees to new roles and selecting which staff should remain when the number of existing roles has reduced: an employer has more latitude to consider future suitability when selecting the right person for a new job, even if that involves subjective assessment of the candidates’ strengths.
If any of the candidates are on maternity, adoption or shared parental leave, they are entitled to be offered any suitable alternative vacancies first but, after that, the employer is entitled to undertake a competitive interview process and to appoint (in its view, even if that view is subjective) the best candidate for the job. A fair and reasonable decision might, for example, be one where the appointment is decided by an appropriately qualified panel after similar interviews, and with a fair and objective scoring system.