The Employment Appeal Tribunal (EAT) has agreed a tribunal’s decision that the use of some subjectivecriteria by an employer in deciding which potentially redundant employee to appoint to an alternative vacancy can in certain circumstances be fair.

In the case of Morgan v The Welsh Rugby Union, Mr Morgan’s post was made redundant as part of a restructuring exercise. He was then interviewed for a new role which had been created as part of the reorganisation, along with one other internal and one external candidate.

The other internal candidate was appointed to the job because he impressed the employer more at interview and it was considered he had a “clearer vision” for coaching development. However, he did not have the qualifications required in the job description and person specifications for the job, whereas Mr Morgan did. Furthermore, although the employer prepared a job specification and format (with scoring) for interview, the interviewing panel did not adhere to this format. For example, it had allowed the successful candidate much longer for his presentation and it did not ask him the standard questions that had been prepared in advance.

Mr Morgan’s complaint was the appointment process lacked all objectivity and fairness and that in consequence his dismissal was unfair.

The Employment Tribunal decided that Mr Morgan’s dismissal was fair. The Tribunal accepted that it would have been better if the interviewing panel had followed the intended process more strictly, but after a careful review it considered that the interviewing process was objective and fair. The Claimant appealed.

The EAT considered the legal test for determining the fairness of a dismissal for redundancy, as set out in section 98(4) of the Employment Rights Act 1996:

"...the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer)-

(a) depends on whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and

(b) shall be determined in accordance with equity and the substantial merits of the case."

The EAT was critical of the Welsh Rugby Union’s failure to mark the candidates in accordance with the original selection criteria, but held that this was only one matter to take in assessing whether the dismissal was fair under section 98(4).

With this in mind, the EAT found that the Welsh Rugby Union was not bound to adhere to the relevant job description or person specification slavishly or precisely. The employer was entitled to interview candidates even if they did not precisely meet the job description and it was entitled to appoint a candidate who did not precisely meet the person specification. The employer was entitled at the end of the process, including the interview, to appoint a candidate which it considered able to fulfil the role.

The EAT also held that an employer’s assessment of which candidate will best perform in a newly-created role is likely to involve a greater element of judgement than for an existing role. When considering the appointment of redundant employees to newly-created roles the employer had to be forward-looking in its decision, which was likely to centre upon an assessment of the ability of the individual to perform in the new role involving something much more like an interview process, particularly where the new role was at a high level and involved promotion.

However, where an employer had to decide which employees from a pool of existing employees are to be made redundant, and which employees would be appointed to the remaining existing jobs available, the criteria will reflect a known job, performed by known employees over a period. In such circumstances, an employer would be expected to adhere more rigidly to objective selection criteria.

The EAT also found that whist it was regrettable that there was no person with specific coaching experience on the panel, the committee was nonetheless an extremely senior committee with experience of making key senior appointments.

This case does not mean employers have carte blanche as to who they appoint to new roles as they still must act fairly and reasonably. In this case, the EAT took account of the fact that the selection was made by a qualified panel, that the interviews lasted for around the same length of time, and that a fair and reasonable interview and selection process had been applied in the circumstances.