Veitch Penny LLP - Exeter | Crediton, Devon

Case

Alexander & Another v Bridgen Enterprises Limited
Employment Appeal Tribunal (12 April 2006)

Issues

(1) Unfair Dismissal
(2) Redundancies
(3) Statutory Dismissal and Disciplinary Procedures

Facts

Mr Alexander and Mr Hatherley were employed by the Respondent Company as welders. In November 2004, the Respondent decided that, due to the company's financial position, the welding department needed to be re-organised. Out of the welding team, ten of the welders needed to be made redundant. The employees within that group were informed of the situation at meetings held on 13th and 15th December 2004. The selection criteria of the employees to be made redundant had been made by the Manager of the welding team on the basis of criteria drawn up by the Human Resources Manager. The Manager was also provided with guidance regarding how the assessment should be made. Mr Alexander and Mr Hatherley had obtained low scores and were among those who received a letter from the employer advising that their jobs were at risk.

During meetings on 12th January 2005, the employees were told of the selection criteria, but were not told of the manner of the selection or about the assessment guidance. A further meeting was held on 21st January where they were informed that they had been selected for redundancy and given details of the redundancy packages. It was at the end of this second meeting that they were advised of the scores in respect of each of the criteria. They were not given an opportunity to comment upon them.

The employees affected appealed against their selection for dismissal. Prior to the hearing, their union representative was provided with the selection criteria and guidance and was also given the marks given to all of those who had been considered for selection but without names attached. Therefore he was unable to determine which marks related to which employees. The appeals were unsuccessful.

The employees made claims for unfair dismissal. They alleged that the dismissals had to be considered to be automatically unfair under Section 98 A (1) of the Employment Rights Act because of their employer's failure to properly comply with the Statutory Dismissal Procedure. They alternatively argued that their dismissals were unfair under Section 98(4) because the employers failed to follow a proper redundancy procedure due to the vague selection criteria and the failure of consultation in this respect.

In response, the employer sought to rely on Section 98A(2) of the same Act known as the "Polkey-reversal" section. They argued that, even if there had been procedural failings, it was more likely than not that the employees would have been dismissed in any event. Section 98A(2) states that "subject to sub-section (1), failure by an employer to follow a procedure in relation to the dismissal of an employee, should not be regarded for the purposes of Section 98(4)(a) as by itself making the employer's action unreasonable if he shows that he would have decided to dismiss if he had followed the procedure".

The Tribunal held that the employer had complied with the standard dismissal and disciplinary Procedure. Accordingly, the dismissals could not be found to be automatically unfair. The Tribunal also concluded that the dismissals were not unfair, although it was critical of the way in which the assessments had been carried out. The Tribunal found that if the dismissals were unfair, then there was 100% chance that Mr Alexander and Mr Hatherley would have been dismissed in any event because they had were least qualified and least skilled of the selection pool.

Decision

The matter was referred to the Employment Appeal Tribunal (EAT). The employees argued that the Tribunal had been incorrect. They pointed to the deficiencies in the procedure arguing that it could not comply with step 1 and step 2 of the statutory dismissal and disciplinary procedure. They felt that they should have been given details of their scores and assessments in advance so that they were able to comment.

The EAT confirmed that the tribunal had been incorrect in its findings. It is inherent under the statutory procedure for the employer to provide the ground for the dismissal and the reasons why he is relying upon it. The aim of the procedure itself was to encourage disputes to be resolved internally and at an early stage without the need for recourse to the Employment Tribunal. It was only fair therefore that an employee must be provided with sufficient information with which to give a response to the proposed decision to dismiss.

Accordingly, the Claimants were entitled to a minimum basic award of 4 weeks' pay. However, no compensatory award was made in view of the Tribunal's finding that the dismissal of the Claimants was 100% certain to take effect in any event.

Comments

This case provides some useful guidance regarding the application of the statutory dismissal and disciplinary procedure. A step 1 letter must therefore advise the employee of the grounds which lead to the proposed dismissal together with an invitation to attend a meeting. The statement itself merely must state the issue in broad terms. At step 2, the employer must then tell the employee of the basis for the ground or grounds given in the earlier statement. These are simply the matters which have led the employer to contemplate the dismissal. Sufficient information must be given in order that the employee can properly put his side of the story. In this case, this must include the particular selection criteria used and the particular score the employee had achieved. Consequently, the employees' dismissals were to be deemed automatically unfair because of the employer's breach of the statutory procedure.


Rachel Billen - Associate Solicitor, Commercial Department at Veitch Penny.
Tel: 01392 278381, Fax: 01392 410247, Email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it


This Employment Law Update does not constitute legal or other professional advice and should not be relied on as such. You should take specific advice regarding your circumstances before taking any action based on the information contained within this Update.