Two into one
Labour & European Law Review Weekly Issue 316 25 April 2013
Section 139 of the Employment Rights Act 1996 sets out the specific circumstances in which a redundancy situation can arise. In Malekout v Dr Ahmed and ors (t/a The Medical Centre), the Employment Appeal Tribunal (EAT) held that this included a situation in which the employer made an employee redundant on the basis that they had already hired their replacement and did not need two people to do the job.
Mr Malekout had worked as a practice manager for the medical centre from March 1995. In April 2008 he indicated that he was thinking of resigning and his employer decided the following month to hire a replacement (Mr Kader).
However, Mr Malekout subsequently did not resign which meant that they ended up with two people at the practice doing the same job. As Mr Kader had had an immediate positive effect on the way the practice was run, they decided to make Mr Malekout redundant.
He claimed unfair dismissal, arguing that the real reason for his dismissal was not redundancy but because he had blown the whistle about extra hours payments made to the practice.
The tribunal rejected Mr Malekout’s argument that he had been dismissed because he had made a protected disclosure, holding instead that he was dismissed for redundancy.
Although the dismissal had been procedurally unfair (the practice had not consulted with him), it was “inevitable” even if a fair procedure had been followed because of the loss of mutual loss of trust and confidence between Mr Malekout and his employer and reduced his compensation by 100 per cent.
He appealed against the decision, arguing that there wasn’t a genuine redundancy situation as there had never been two jobs at the practice, only one for a practice manager.
The EAT dismissed the appeal. Relying on the tribunal’s findings, it said that the reason for employing Mr Kader was the fear that Mr Malekout would resign and leave them without a manager.
Once there were two people in the post for effectively one job, “it was inevitable that that situation would result in two employees being reduced to one. That is a diminution in the requirement for employees to carry out work of a particular kind within the meaning of section 139 ERA”.
As for the whistleblowing issue, the tribunal was satisfied that nothing that happened after May 2008 was in any way connected with the alleged protected disclosures. It therefore followed that those disclosures did not form any part of the reason for dismissal and the reason or principal reason as found by the tribunal was indeed redundancy.
Finally, given the clear finding that the selection of the claimant was inevitable, then a 100 per cent deduction necessarily followed.
Although you can see the logic there is something rather odd about being able to create a redundancy situation by hiring the replacement first. If an employee has inadequate service for a redundancy payment then it seems a whole lot easier than bothering with pesky capability proceedings. It also makes you wonder about someone returning from long term sick or maternity leave who compares unfavourably to their ‘temporary’ replacement.