Labour & European Law Review Weekly Issue 289 04 October 2012
Section 98(4) of the Employment Rights Act (ERA) 1996 states that, when deciding if a dismissal is fair, tribunals have to consider whether the employer acted reasonably or not. In Wrexham Golf Co Ltd v Ingham, the Employment Appeal Tribunal (EAT) said that when dismissing someone for redundancy, it may be reasonable to focus on one single employee without considering anyone else.
Mr Ingham, one of 11 club employees, had worked as a bar steward from June 2005. In October 2010 the club decided that, in order to save money, the bar and catering aspects of the club should be combined and the steward’s activities undertaken by other members of staff.
On 10 November, the club secretary met with Mr Ingham and told him there would be a period of consultation when he could put forward ideas about how to avoid the potential redundancy.
Mr Ingham then wrote to the board suggesting that, as the bar had operated at a profit, the redundancies should come from catering which operated at a loss. He also asked whether other areas had been considered – such as administration, greens and cleaning contracts. He referred to two members of the “waiting on staff” and asked if the club could not make savings there.
However, he was informed at the end of December that the board had decided to make him redundant. His appeal against the decision on 13 January was rejected and he lodged a claim for unfair dismissal.
The tribunal said that the dismissal was unfair because the club had not acted “within the range of reasonable responses” open to it.
Firstly, by ignoring the fact that there was considerable overlap between a lot of the work that Mr Ingham did and that of the other bar staff, it had failed to consider the possibility of establishing a “pool” from which to make redundancies. Nor had it identified a set of fair selection criteria for deciding who should be in the pool.
Secondly, it was critical of the information that the club provided to Mr Ingham and the way it consulted with him.
Thirdly, it criticised the fact that the sub-group which had originally met and considered the question of making savings included two people who were subsequently responsible for his dismissal and appeal. The tribunal said that, given the size of the club, it ought to have been able to ensure that different board members were involved in the different processes.
The EAT upheld the appeal because, although the tribunal had applied the range of reasonable responses test, it had failed to consider whether it was reasonable for the board to focus on the club steward as the person at risk of redundancy.
As the tribunal had not criticised the club’s conclusion that the role of steward should come to an end, it should have asked itself at that point whether it was reasonable for the club not to consider a wider pool of employees.
Section 98(4), it said, requires this question to be addressed. And as it seemed to be within the range of reasonable responses to focus on the steward without also considering the other bar staff, the tribunal should have said why it was unreasonable to do so.
It concluded that “There will be cases where it is reasonable to focus upon a single employee without developing a pool or even considering the development of a pool. The question which we do not think the Tribunal really addressed was whether this was such a case”.
It remitted the case for re-hearing in a fresh tribunal.
This case demonstrates the difficulties involved in challenging dismissals for redundancy. Even though past case law suggests that employers must at least address their mind to the question of a pool and there was clearly evidence that this employer had not considered any sort of pool, the EAT still overturned the tribunal’s decision.