Last in, first out

Many agreed redundancy procedures use “last-in-first-out” (LIFO). It favours those with longer service. LIFO agreements have been challenged because of the risk of discrimination against younger, female and ethnic minority workers, who may have less continuous service.

The EHRC says LIFO can be one of a range of selection criteria but that on its own, or as the most important criterion, it is open to challenge as unlawful discrimination.In Rolls Royce PLC v Unite [2008] EWCH 2420, general union Unite challenged a decision to remove LIFO from the Rolls Royce redundancy selection criteria. The High Court said length of service can be a fair indicator of loyalty and experience that is not necessarily reflected by other selection criteria. The court agreed with Unite that using LIFO, while age discriminatory, could be justified in this case because it reasonably fulfilled the business need to maintain a loyal and stable workforce.

The court also found that using LIFO could help achieve a peaceable selection process. However, although the need for industrial harmony can help justify age discrimination, it cannot be the main or only justification (Kenny v Ministry for Justice [2012] EUECJ C-427/11).