Authors
Authors
In a judgement published by the Employment Appeal Tribunal (EAT) on 6 June 2025 for the case of Hendy Group Ltd v Daniel Kennedy: [2024] EAT 106, Employers are reminded of the importance of fully discharging their obligations to properly consider alternative employment for employees facing redundancy.
Background, Employment Tribunal (ET), EAT
The Claimant (Kennedy), had been working as a sales trainer for the Hendy Group Limited (the Employer), a car dealership, since 2013, and had over 30 years’ experience in the motor industry in training and sales. In 2020, a genuine redundancy situation arose in which Kennedy was fairly selected for redundancy.
During consultation, Kennedy was invited to apply for alternative roles advertised on the Employer’s intranet, however, Kennedy had no access to the Employer’s intranet during his notice period and only had public access to the vacancies. Kennedy applied for several jobs across the Employer’s various subsidiaries but was unsuccessful in obtaining any alternative roles.
Kennedy brought an unfair dismissal claim against the Employer on the grounds that the Employer had failed to discharge their positive obligation to seek and properly consider alternative employment.
The ET found that Kennedy’s dismissal was unfair because the Employer had failed to consider alternative employment, and when the Employer appealed, the EAT agreed with the ET and dismissed all grounds of appeal, reinforcing the ET’s findings including:
- The Employer failed to effectively support Kennedy in securing an alternative role, which extended in some instances to actively blocking Kennedy’s applications by not even offering him an interview, and this was contrasted against Kennedy’s notable proactivity in attempting to secure an alternative role. It was noted that Kennedy was left to apply in the same way as external candidates as he could only access public job vacancies, and he received no support from HR or management, and the managers were not made aware that he was at risk of redundancy;
- Kennedy was given no guidance to identify what roles could be suitable for him and the Employer could not evidence any attempt to match Kennedy to any available roles;
- Assumptions about Kennedy relating to not wanting to return to sales should have been irrelevant to the consideration of Kennedy’s applications for sales roles after he was put at risk of redundancy and should not have influenced recruitment decisions, especially in light of Kennedy’s clear efforts towards remaining employed; and
- The Employer’s duty to consider alternative employment was assessed against the size and administrative resources of the employer. This was a large organisation with large resource and therefore in a short period of time, there were many vacancies the Claimant was likely suitable for consideration for.
A feedback email sent to Kennedy regarding his unsuccessful applications for sales roles, also contributed to the finding that the Employer failed to discharge their obligation for the below reasons:
- The email was delivered on Kennedy’s last day with the Employer to an email account that Kennedy could not access;
- HR, who should have been supporting Kennedy in seeking alternative employment, instead questioned Kennedy’s motivation for applying suggesting that Kennedy was more interested in obtaining a job than in the jobs he was applying for;
- HR confirmed that Kennedy would not be successful in any sales role with the Employer, despite Kennedy’s 35 years selling cars and training people to sell cars, due to the Respondent’s assertion that Kennedy’s training work had removed him from sales for too long – an issue the Judge found could easily have been resolved with training; and
- HR’s failure to suggest that Kennedy try any other roles in the email.
The Employer also applied for a reduction to Kennedy’s compensation under Polkey v AE Dayton Services Ltd [1987] IRLR 503 (Polkey) – a deduction that can be applied to unfair dismissal compensation awards, if found that despite procedurally unfair elements, the dismissal would have happened in any case. The ET found here that it would not be appropriate to make a reduction under Polkey as the procedural unfairness (effectively blocking alternative employment) was the reason that Kennedy did not secure another role and was dismissed. The EAT upheld this decision, agreeing with the ET that no Polkey reduction should be applied, as had the Employer acted fairly, Kennedy would likely have secured another job.
Key takeaways
This case reinforced the importance of employers effectively discharging their duty and evidencing their efforts to seek and properly consider alternative employment for employees at risk of redundancy, especially within large organisations with available resources. This is all the more significant given the decision to award full compensation with no Polkey reduction applied, establishing that employers whose procedural failings prevent an employee from securing an alternative role, could face the full financial consequences of an unfair dismissal.
To mitigate this risk and meet the legal obligation of a reasonable employer to seek and consider alternative employment, employers should:
- attempt to evidence reasonable steps taken to secure alternative employment for the affected employee, by supporting them in applications or matching them to appropriate vacancies – this could take the form of speaking to employees about their professional interests, identifying appropriate roles, and encouraging conversations about different roles and applications. Signposting vacancies and simply directing affected employees to public job lists will likely below what is required to discharge this duty.
- inform managers about employees who are at risk of redundancy and are applying for relevant roles.
- communicate with affected employees clearly and effectively, and not on systems the employee may no longer have access to.
- not make assumptions about an employee’s motivation or past preferences when considering applications from affected individuals actively seeking to remain employed.
- consider whether shortcomings or reservations about an affected candidates’ suitability for an alternative role could be remedied with training.
To discuss any of the issues raised in this article please contact Kate Gardner or Sonia Bungaroo Valdés.