One of the first things an employer will need to consider when commencing a redundancy exercise which involves reducing staff numbers, is which employees it is appropriate to “pool” together for the purposes of deciding who will be selected and dismissed for reason of redundancy. Failure to consider what the appropriate “pool” of employees will be, and to apply reasonable selection criteria to the redundancy selection process, may result in a claim being brought and the redundancy dismissal being deemed unfair by an Employment Tribunal.
In the recent case of Mogane v Bradford Teaching Hospitals NHS Foundation Trust[1] the Employment Appeal Tribunal (“EAT”) considered the impact of an employer’s chosen “pool” and selection criteria for redundancy.
In this case, Ms Mogane worked as a nurse under a fixed-term contract. Due to certain financial constraints which required the Trust to make a reduction in staff, a redundancy situation arose within the research unit that Ms Mogane worked in at the Trust. Both Ms Mogane and another nurse were employed under fixed-term contracts, but Ms Mogane’s contract was due to expire earlier than that of the other nurse’s.
The Trust decided not to renew Ms Mogane’s contract on the basis that her contract was coming up for renewal soonest. No alternative processes were adopted in order to decide who should be made redundant in the circumstances and, crucially, the Trust did not at any point consult about the fact that the sole selection criteria it intended to use would be whose fixed-term contract expired first.
Initially, the Employment Tribunal found that Ms Mogane’s dismissal for redundancy was fair.
However, the EAT has now overturned this decision and ruled that, since a fair and meaningful consultation did not take place, Ms Mogane’s dismissal was, in fact, unfair.
As the effect of adopting the above criterion meant that Ms Mogane was placed in a pool of one and would inevitably be selected for dismissal, the EAT held that a consultation about adopting this criterion should have occurred beforehand.
This point about consultation was key - had a consultation about adopting this criterion taken place, there could have been an opportunity for Ms Mogane to change or influence the outcome.
The EAT noted that a pool of one can be appropriate in some circumstances (which will depend on the facts of the case), but this ”should not be considered, without prior consultation, where there is more than one employee.”
This case emphasises the importance of consultation taking place at a stage in the redundancy process when the employee(s) or representatives still have the possibility of influencing the outcome. Otherwise, the redundancy consultation exercise will not be “genuine and meaningful”.
Before commencing a redundancy process, employers should ensure they have planned out and thought-through the different stages of the process which will, if staff numbers are being reduced, include identifying an appropriate “pool” of employees and considering the selection criteria that will be used. In addition to this however, employers should plan when they will consult with employees (or employee representatives). In certain circumstances, such as in Ms Mogane’s case, it may be appropriate for this consultation to extend to the decision-making about who is in the “pool” of employees or the selection criteria it is proposing to use.
Where an employer decides that formal consultation on these points is not necessary in the circumstances, the employer should still inform the “at risk” employees about the selection criteria it is proposing to use in advance of the selection process being carried out, to give employees the opportunity to comment or feedback on this criteria if they wish to. That way, any concerns about the criteria being used can be addressed at the outset, leading to fewer appeals (and/or claims) down the line.
This case also reminds employers of the need to consider carefully whether a “pool” of only one employee is definitely reasonable and appropriate in the circumstances. This will always depend on the particular facts of the case.
We would always recommend that employers seek professional advice when considering making redundancies, to ensure that they will be following a fair redundancy process and minimising the risk of any claims being issued in the future.
For more information, please contact our Employment team.
[1] Mrs_S_Mogane_v_1__Bradford_Teaching_Hospitals_NHS_Foundation_Trust_2__Karen_Regan__2022__EAT_139.pdf (publishing.service.gov.uk)
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