Early redundancy consultation is still important

The case of Haycocks v ADP RPO UK Ltd is a useful reminder of the principles governing a fair redundancy consultation process.

The Claimant in this case was part of a 16-strong in-house recruitment team and the employer proposed to reduce the team. The manager was given a scoring matrix against which they scored all 16 employees. The scoring process took place before the employer decided how many redundancies that it proposed to make. It eventually proposed two redundancies including the Claimant. He was invited to a consultation meeting at which he was asked to suggest alternatives to redundancy. Following consultation, there was a further meeting at which he was made redundant and his appeal against redundancy was unsuccessful.

The Employment Tribunal rejected his claim for unfair dismissal, but this was overturned on appeal to the EAT.

The EAT found that the Claimant had been unfairly dismissed. They considered that the Tribunal had failed to address in its decision the absence of consultation at a “formative stage”: i.e. when it could make a difference. In this case, for example, the employer did not decide on the number of redundancies until 18 June 2020, and the first consultation meeting was on 30 June 2020, having carried out the scoring early in June 2020. There did not therefore seem to be a huge degree of urgency and no reason why the employees could not have been consulted about the scoring process before it was undertaken (and thus have the chance to suggest an alternative approach). The EAT's decision is not a radical departure from the general understanding that there must be reasonable consultation prior to redundancy dismissals. However, it is interesting that the EAT comments that a lot of the established case law on redundancies is old and that there may now be some different considerations:

• More redundancies occur now in non-unionised workplaces than happened in the 1980s in which case law is grounded. Established case law, and legislation in relation to collective consultation requires trade unions to be consulted at a formative stage of proposals and the EAT here considered that this does not mean that an employee in a non-unionised workplace should only receive “individual consultation” at a late stage, as they do not therefore have the protection of being able to make suggestions while proposals are at an early stage.
• It is more common now to have an international dimension to businesses and redundancy decisions. The employer in this case was the UK subsidiary of a US business and it was the US business who had provided the suggested selection criteria. This international dimension heightened the need for consultation with employees at an early stage so that they had the opportunity to challenge and question the US approach before it was too late.

Employers commencing redundancy processes, whether collective or individual, should not neglect the requirements of a reasonable consultation process, starting at an early stage.

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If you have any queries you would like to discuss regarding early redundancy consultation please contact Rena Magdani or Matt McBride.