Redundancy pool

One of the requirements in a redundancy process is for employers to give careful consideration to the appropriate pool from which employees are selected.  Employers often want to mark a role as “unique” to avoid time consuming consultation and selection processes or unsettling others in the workforce who ultimately they know will not be affected.  Occasionally they might even believe that the role truly is unique.  But that really doesn’t matter. 

The recent case of Fulcrum Pharma (Europe) Limited v Bonassera and another highlighted the problem and serves as a reminder that the law will look deep into the mindset of the business in this situation.  The EAT ruled in Fulcrum that it was wrong of the employer automatically to restrict the pool to the unique role. “Automatically” is the key word here.

Fulcrum decided that it no longer needed an HR manager and automatically restricted the pool of affected employees to just one, without giving any consideration to whether the lower role of HR Executive should also be included. The EAT did not criticise the business decision itself to lose the more expensive manager role.  But it did say that the automatic decision to put the manager into a pool of one was a mistake.  What this case shows is that, it’s just as much about what went on behind the scenes, rather than just the end result. 

So what should you do in this case then?  In practical terms, this is where the lines become blurred as to where initial stage of putting an employee at risk ends and consideration of alternative employment begins.  Practically, employers should then consider alternative employment at the very start of the thought process.  What the EAT wants to see is an employer who has gone through a logical and reasonable thought process in order to arrive at its decision. If you have consulted with the employee, well that’s even better.  And a gold star to the employer who has documents to prove this thought process!

Perhaps the at risk employee would rather be considered for a more junior role than lose his or her job?  That, says the EAT is a question for the employee to decide, and not the employer.