New Redundancy Criteria Decision Not All that It Seems (UK)
So, quick, answer me this – when making redundancies outside the collective consultation rules, do you need to consult with the affected employees about the selection criteria relied upon or only as to the proposed impact of those criteria on that person?
Traditional wisdom would point to the latter. The selection criteria are a matter for the employer’s discretion in the light of its inside knowledge of what skills and attributes it will most need in its slimmed-down future form. So long as they are reasonable, relevant and capable of fairly objective assessment, it is not for the employee or indeed the Employment Tribunal to go behind them.
Then hold that thought and consider the necessary meaning and purpose of individual redundancy consultation, i.e. to provide an opportunity for the employee to influence decisions before they are taken. Consultation only after the event is clear pre-determination and therefore essentially fatal to the statutory fairness of the decision.
But what if the chosen criteria (which you don’t have to consult about) effectively make that decision (which you do) by themselves? Raise your hats, please, for the EAT’s new ruling in Mogane –v- Bradford Teaching Hospitals NHS Foundation Trust, which suggests in fairly robust terms that this necessarily brings in the selection criteria as a proper topic of consultation prior to the dismissal, thereby seemingly putting a coach-and-four through the long-accepted principle that they are not. We have already had this case argued against a number of our clients, but looked at more closely, probably without merit.
Ms. Mogane was a nurse at the Trust employed (like the only other one at her level) on a series of short fixed-term contracts. When the Trust decided to make one of them redundant, it picked Mogane on the sole basis that her current contract expired first. As soon as proximity of expiry became the criterion, Mogane was doomed. Choosing that criterion was in effect making the redundancy decision, and since there was no consultation prior to that, the EAT found the dismissal unfair.
However, the whole point of selection criteria is to allow an employer to identify the people who should be made redundant. If they are applied objectively, all selection criteria in effect dictate who should lose their job – that is their purpose. Much has been made in commentaries on Mogane of the expiry date being the sole criterion. However, as an issue of principle, I am not sure that matters – even if you used more customary criteria around performance and time keeping, commitment and skillset, etc., they would still ultimately point the redundancy finger squarely at your “bottom” employee very nearly as automatically. In a sense, the more obvious the selection decision, the more easily it could be argued that the criteria essentially make that decision for you, and so should have been consulted on first. That cannot be right, at least not until it becomes apparent that those criteria were reverse-engineered specifically in order to justify a redundancy decision already made.
The issue here was in fact a slightly different one. It was the reasonableness of relying wholly upon a criterion with no obvious relevance to the best interests of the Trust going forward or to any assessment of the relative suitability of Mogane and her colleague, coupled with the dismissing manager’s refusal to heed guidance from HR that different criteria might be more appropriate. By the time Mogane had her consultation meeting, therefore, the selection ship had sailed and all that remained was an unsuccessful endeavour to find her another role. Therefore Mogane was not given a real chance to argue that she had other positives or attributes that should outweigh any benefits to the business arising from her contract expiring first.
In principle, there is nothing wrong with using contract expiry dates as your selection criterion. However, to remove the inevitable suggestion of unreasonableness, you should have some very clear justification for doing so instead of using a more usual approach looking at best fit for the employer’s future needs. You could accept upfront, for example, that either or all of the candidates had demonstrated completely comparable performance and conduct, such that scoring those factors would not enable you to put any distance between them. Using those criteria would therefore be pointless. Then you would wish to show why expiry dates mattered, which is where you could struggle, especially if they were only a small time apart. If ending one contract could be achieved much more cheaply than the other because a substantial part of that was still left to run, on the other hand, that might in theory be a reasonable criterion in a redundancy exercise driven by the need to save costs. In reality, however, the employer should then be looking not at expiry dates, but at the notice terms applicable in the interim, since it is actually that which would dictate the costs.
Equally in principle, there is nothing amiss with only using a single criterion if it can be shown to be a sensible means of picking the person best suited to the organisation’s future needs. That was not the case here, found the EAT. In addition, using a single criterion will very rarely be a good idea in practice, since a redundancy decision will almost never be so one-dimensional, and it is again easier for the employee to argue that selection of the criterion is tantamount to selection of the individual.
So Mogane is not authority for the proposition that you have to consult on selection criteria in individual redundancies, or that the use of one selection criterion only will make the dismissal automatically unfair. Instead it should be taken as reinforcing existing redundancy principles around the reasonableness and relevance of the selection criteria used and the requirement that consultation be both genuine and (as part of that) prior to the actual redundancy decision.