Emily Edwards
Posted on 15 Sep 2020

Unfair dismissal by reason of redundancy

[Read time: 3 minutes]

The Employment Tribunal ("ET") has held that an employer who failed to place a redundant employee on a list of ad hoc workers did act reasonably in the context of an unfair dismissal claim.

In Aramark (UK) Ltd v Fernandes, the Claimant brought an unfair dismissal claim after being made redundant by the Respondent. The ET considered whether, in failing to place the Claimant, whose post had become redundant, on a list of workers whose services could be called upon if required, the Respondent had acted unreasonably.

Background

Redundancy is one of five potentially fair reasons for dismissal. A redundancy situation can arise in a number of circumstances, including where an entire business ceases to trade, or there is a closure of a particular site within an organisation. However, the most common occurrence is where an employer has a reduction in the number of employees it requires to carry out a particular type of work.

In addition to establishing redundancy as the potential fair reason for dismissal, the Tribunal must be satisfied that it was reasonable to dismiss that employee. To satisfy this test, employers will have to demonstrate that they have conducted a fair procedure, including appropriate 'pooling' of employees, and sufficient consultation.  They also have a responsibility to take reasonable steps to identify opportunities for any alternative employment within the organisation.

Aramark (UK) Ltd v Fernandes

Mr. Fernandes was made redundant by the Respondent and successfully claimed at the ET that the Respondent's failure to include him on a list of supplementary workers, upon whom it called on an 'as and when' basis, was unreasonable.

However, the Respondent appealed the decision, and the Employment Appeal Tribunal ('EAT') confirmed that the relevant question was whether the Respondent had behaved reasonably in treating redundancy as a sufficient ground for dismissing Mr. Fernandes.

The relevant law states that the fairness of the dismissal 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.

What was held?

The EAT decision turned on the fact that, if Mr. Fernandes had been added to the list of additional resource, it would not have avoided his dismissal – although it would have opened the possibility of work, it would not have secured alternative work. Therefore, the failure to be listed was not unreasonable and the Respondent's appeal was upheld.

What should employers take from this?

When dismissing employees by reason of redundancy, the redundancy may be unfair if the employer fails to make a reasonable search for suitable alternative employment to try to avoid the redundancy. However, as a result of this case, it is clear that this obligation will not include placing the employee in question on 'bank staff' style list, where there is only the possibility of work, not a tangible and meaningful alternative.

This article is for information purposes only and is not a substitute for legal advice and should not be relied upon as such. Please contact Emily Edwards to discuss any issues you are facing.