Many businesses are currently considering redundancies in some way due to the impact of COVID-19. The Employment Appeal Tribunal has handed down judgment in a case which considered the use of a competitive interview process to determine which employees should be given ‘alternative’ roles at a newly created workplace.
The case provides further guidance, contrasting the approach of putting everyone at risk and asking them to apply for jobs v selecting who should be made redundant from appropriate selection pools.
Gwynedd Council v Barrett
Shelley Barratt and Loan Hughes were teachers employed by Gwynedd Council to work at a local community secondary school. The Council resolved to implement a reorganisation of the schools in the local area, closing the school at which both Barratt and Hughes were working and a number of other primary schools. The Council intended to combine them together to form a new school to operate at the same site as their original school.
Both Barratt and Hughes were kept informed of the reorganisation process throughout and informed that their contracts of employment would be terminated as part of the process. Staffing of the new school would then be determined by an application and interview process, with unsuccessful candidates being made redundant.
Both Barratt and Hughes applied for positions at the new school. They were interviewed but unsuccessful and therefore given written notice of termination on the grounds of redundancy. Barratt and Hughes queried the fact that they were not given the opportunity to make representations or appeal in respect of the decision to dismiss. The governing body of the new school responded stating that such failures did not cause either of them disadvantage and the dismissals were caused by the closure of the original school, which no appeal panel would have been able to reverse as to avoid the dismissals. Nonetheless, both Barratt and Hughes claimed that the dismissals were unfair and issued Employment Tribunal proceedings.
The parties acknowledged that both were dismissed on the ground of redundancy and neither were given the opportunity to make representations or an appeal. The parties understood that having such right of appeal however would have made no difference to the outcome.
The Tribunal focused on the redundancy process itself, finding that it was ultimately unfair because of the use of the competitive interview process to determine which of the teachers should be given jobs at the new school, and the lack of any consultation with those teachers. The Council appealed the decision.
The EAT dismissed the Council’s appeal, finding that the Employment Tribunal was correct in finding that the Council had made fundamental and profound failures throughout the process, rendering the dismissals unfair.
The EAT found there was a distinction between a redundancy process where employees were considered for alternative jobs using a ‘forward looking’ selection process (for example with the competitive interviews for the new posts) and a process of consultation and selection using objective criteria. In this case, both employees were effectively asked to apply for the same job rather than a new post. The process was therefore not so much ‘forward-looking’, selecting for new roles on the basis of perceived skills, but closer to a selection process from within a pool. Effectively, the Council’s approach to alternative employment was to simply require employees to apply for their own jobs, with no consultation or appeal, and that was unreasonable.
The judgment clarifies that employers may reasonably use an interview process when considering redundant employees for alternative employment but that alternative employment should not be for the same or very similar to the job they are losing.
The decision comes at a significant time in which many employers are faced with redundancy situations, due to workplace closures or re-organisations resulting from the impacts of COVID-19.
Employers are under a duty to consider alternatives to redundancy, including any suitable alternative roles which may exist. How they select who will get the alternative roles from those who may otherwise redundant is important.
It is fairly common to hear stories of all employees at an organisation being put at risk and invited to essentially apply for their own jobs. This case confirms that to be the wrong approach if the jobs are the same or fundamentally the same. Where the jobs are the same, the employer should define pools for selection and then select who will be made redundant using objective selection criteria (or at least semi-subjective criteria which is objectively verifiable).
If you have any queries in relation to redundancies or any other employment or HR queries, please do not hesitate to get in touch on 01228 552600 or 01524 548494
This alert does not provide a full statement of the law and readers are advised to take advice before taking any action based on the information contained herein.