A recent Employment Appeal Tribunal (EAT) case of Hendy Group Ltd v Daniel Kennedy [2024] EAT 106 (Hendy) is a good example of how employers should not conduct a redundancy process. This article will briefly summarise the facts of the case and highlight the key points for employers to consider.
Facts
In Hendy, the claimant was employed at a car dealership. At the time of his dismissal, the claimant was employed as a trainer within Hendy Group’s dealership academy and had been in the role since 2015. His role involved providing training and support for Hendy’s entire workforce. Before taking up that role in 2015, the claimant boasted some 30 years’ experience in the motor trade, specifically in sales before he finally transitioned into his role as a full-time trainer within the Training Academy in 2015.
In 2020, a redundancy situation arose following the pandemic. Throughout the proceedings, the claimant accepted that it was a genuine redundancy situation, but he challenged the fairness of the redundancy on the basis that Hendy had not adequately considered whether he could have continued to work for them in a suitable alternative role within the organisation.
The Employment Tribunal (ET) ultimately found in the claimant’s favour and criticised the conduct of Hendy during the redundancy process, noting that its HR department had taken no step whatever to assist the claimant. The extent of assistance appeared to be limited to the claimant being advised in a consultation meeting that he could apply for jobs through the company’s intranet. He lost access to the intranet a week later when he returned his laptop, as required by the employer.
However, despite the lack of proactive assistance from the employer, the claimant nonetheless still applied for various jobs. During this process, he was unsuccessful for various reasons, including that he had previously expressed a firm interest in remaining within the Training Academy (however this was before there was a risk of redundancy on the horizon.). The HR department stated in November 2020 that the claimant would not be considered for any future sales roles due to a previously unsuccessful interview (despite his previous experience selling cars and training others to sell cars).
Whilst Hendy appealed the judgment, the EAT ultimately agreed with the findings of the ET.
Implications for Employers Managing Redundancy Processes
1. Employers should actively consider suitable alternative employment
The case of Hendy demonstrates that employers should play an active role in facilitating suitable alternative employment. In this case, both the ET and the EAT were critical of the refusal of the claimant’s line manager or any HR representatives to assist him with applying for any roles outside of the Training Academy.
2. An employee’s previous plans or expectations may change in light of a redundancy situation
Whilst the claimant had previously expressed a desire to remain in the Training Academy, his plans changed when the redundancy situation arose, and he was subsequently open to taking up a sales role. This meant that, when considering whether to offer a sales role to the claimant, his past desire to remain in the Training Academy should not have been a critical factor.
Therefore, employers should keep an open mind throughout the redundancy process.
3. Consider each application individually and on its merits
Both the EAT and ET in this case criticised the blanket rejection adopted by Hendy in November 2020. The employer in this instance had not adequately considered the claimant’s previous experience in sales.
It is therefore crucial to consider any job application brought by any employee at risk of redundancy on their merits.
4. Reasonableness
Employers must undertake a reasonable search for suitable alternative employment. Whilst this does not mean that employers should create jobs specifically to retain staff at risk of redundancy, they should not adopt a passive approach as had happened in this case.
5. Training
Employers should provide training for managers involved in redundancy processes to ensure they understand legal requirements and best practices. This can help prevent procedural errors that may lead to unfair dismissal claims.
Please note the contents of this article do not constitute legal advice. If you require any further information or if you would like our assistance, please contact us at employment@berrysmith.com or on 02920 345 511.