The EAT decision in Kennedy v Hendy Group Ltd provides a helpful and cautionary reminder for employers of an often over-looked and underestimated part of a fair redundancy process; the duty to consider alternative employment opportunities for the redundant employee.
Background facts
Mr Kennedy was employed by the Respondent car dealership chain, as a trainer for its car sales workforce. He had undertaken the role for just over 5 years at the time of his dismissal in November 2020, having had an initial period of 2 years working for the Respondent as a car sales manager when he first joined the company in 2013. In total, the Claimant had around 30 years’ experience in motor trade sales.
The issues
It was not in dispute that Mr Kennedy’s role became redundant during the Covid pandemic. The issues in this case centred around the Respondent’s failures to support Mr Kennedy in his efforts to secure alternative roles within the Respondent’s business in order to avoid him ultimately being dismissed from its employment.
The proceedings
The Employment Appeal Tribunal (EAT) upheld the Southampton Employment Tribunal’s decision that Mr Kennedy’s dismissal was unfair, rejecting every aspect of the Respondent’s appeal and endorsing the tribunal’s findings and criticism of the Respondent’s approach.
The law
As part of its considerations as to whether a redundancy dismissal is fair, a tribunal will have regard to the whether, in the circumstances, including the size and administrative resources of the employer, it acted reasonably in treating the reason (redundancy) as sufficient for dismissing the employee.
Therefore, just because the employee’s role is redundant, that is not the end of the story. The employer must then ask itself, as a tribunal will:
Is / was it a reasonable decision to dismiss this particular employee for the potentially fair reason of redundancy?
Since as early as the 1970s, case law has established that part of this reasonableness consideration involves whether the employer looked for and offered alternative employment. The decision to dismiss will only be fair if reasonable efforts were made to avoid dismissal by looking for and offering other roles that are appropriate for the employee.
Key findings and criticism of the respondent
Some of the key criticism were specifically focussed on the HR team. The tribunal found not only that it failed to proactively support Mr Kennedy by providing him with support and access to internal job vacancies; but more concerningly, its approach was found to have contributed the finding that the Respondent actively blocked his efforts to remain employed.
It was noted that the dismissal / notice letter sent in late September 2020 made no mention of the possibility of alternative employment, which the tribunal took as evidence of the Respondent’s failure to consider or have regard to its duties in this respect. Instead, its approach seemed to be that he was welcome to apply for vacancies alongside external job applicants, which was simply not sufficient.
HR’s failure to notify its recruiting managers that Mr Kennedy was available for consideration for alternative vacancies was also specifically noted as a reason for an external candidate being appointed to a potentially suitable post that he became aware of and applied for after the appointment had been made.
Equally, the decision to remove Mr Kennedy’s laptop and his access to the Respondent’s intranet and internal email a week after notice of dismissal was given, resulted in him effectively being excommunicated from colleagues and denied internal information about vacancies during his notice period.
Notwithstanding the lack of support, in the intervening weeks before his dismissal in November 2020, Mr Kennedy made several applications to the Respondent for sales manager posts in various locations, which the tribunal and EAT agreed he was potentially suitable for
- failing to make appropriate referrals within the business to ensure Mr Kennedy got the support he was entitled to and / or taking a narrow approach of what they, individually, could do to assist him, for example saying they could not do anything outside their own department.
- Appointing another internal candidate who was not at risk of redundancy to the first sales manager post Mr Kennedy had applied for. In evidence, the Area Sales Manager, Mr White, who interviewed the Claimant, told the tribunal that he considered the Claimant not to be “a good fit” for the role and said he was not convinced of the Claimant’s “desire to lead and motivate a team”. Mr White also gave evidence that he considered the Claimant “was simply keen on remaining employed”.
- Thereafter, Mr White negatively influencing another manager, resulting in that manager failing to interview Mr Kennedy for another vacancy application he had also found and pursued himself.
- Inappropriately placing weight on an unrelated conversation about a year before the redundancy situation arose, when the Claimant had expressed his enjoyment in his training role and wish to continue in it. This was effectively held against Mr Kennedy by management who made assumptions about his suitability, for which read lack of enthusiasm or genuine desire, for the sales roles he applied for once “the spectre of redundancy was …looming”.
The tribunal decided that the Respondent not only failed to support Mr Kennedy, but ultimately actively blocked his own efforts to secure alternative employment. This culminated in HR writing to Mr Kennedy in response to two sales manager applications, saying that Mr White’s assessment of Mr Kennedy as being unsuitable for the first job meant that Mr Kennedy, whilst welcome to apply, would not receive a different outcome in respect of any applications for any sales jobs that he made.
Comment and practical tips
The case serves as a helpful reminder that establishing that a role is redundant is only the first part of an employer’s consideration and does not automatically mean that dismissal will follow every case. Affected employees should be supported to find alternative employment and this includes within the employer’s own business. This duty continues throughout the employee’s notice period and up until the point that dismissal takes effect.
Practical steps that can be taken include:
- Informing recruiting managers of employees available for role moves due to being on notice of redundancy;
- Keeping all ‘at risk’ employees notified of available internal vacancies;
- Discussing the employee’s skill set, experience, personal circumstances so as to avoid making assumptions on what alternative roles may be suitable for that individual.
Remember:
- In some cases, a suitable alternative role could be entirely different from the redundant role.
- Even if the individual is not an immediate / automatic ‘fit’ for an alternative role, it could still be reasonable to offer it with support and / or training and / or a trial period.
- An ‘at risk’ employee does not necessarily need to be the best candidate for a job. If they are suitable, it may be reasonable to appoint them ahead of others (and, importantly, unreasonable and, so, unfair, not to appoint them).
If you need advice or guidance navigating the minefield of potential redundancy dismissals, our team has vast experience in this area.
