LRD guides and handbook May 2019

Law at Work 2019 - the trade union guide to employment law

Chapter 11

Voluntary redundancy 





[ch 11: pages 385-386]

An employer can ask for volunteers to avoid compulsory redundancies. There is no obligation to ask for volunteers and not doing so will not make compulsory redundancies unfair (Rogers and others v Vosper Thornycroft [1989] IRLR 82). 


An employer can devise its own procedures for voluntary redundancies, preferably in consultation with any recognised union. Like any other procedure, they must not discriminate unlawfully against protected groups such as part-time workers, young workers, those engaged in lawful trade union activities or disabled employees, or penalise employees for exercising their statutory rights. 


Organisations subject to the Public Sector Equality Duty (PSED) (see page 269) must comply with the PSED when devising and implementing redundancy programmes. A proper equality impact assessment, in consultation with the union, is the best way of securing compliance. 


Where employees volunteer for redundancies, reps should take care that they are not volunteering because they believe they will not get a fair chance at available jobs due to discrimination. In Derby Specialist Fabrication v Burton [2001] IRLR 69, an employee who volunteered for redundancy for that reason was able to claim constructive discriminatory dismissal. 


 




Voluntary redundancy packages are often conditional on the signing of a Settlement Agreement promising not to bring an employment tribunal claim (see Chapter 14, page 488). 


There is no statutory obligation to apply a selection procedure when deciding who to accept for voluntary redundancy, or to accept employees who put themselves forward. Ordinary standards of fairness and non-discrimination apply. 


Terms for voluntary redundancy are usually better than those for compulsory redundancy, but there is no law that says they must be better. 





As long as there is a genuine redundancy situation when the employer invites volunteers, voluntary redundancies are normally treated as dismissals, in the same way as compulsory redundancies. However, the situation is not always clear and reps need to be alert to the risks, as the next case highlights: 



Mr Khan worked at a call centre for business process managers HGS Global, providing services to a company called Dreams. Dreams decided to take the call centre services in house. This was a TUPE transfer and during pre-transfer consultations, anyone who, like Khan, would face a commute of over 75 minutes under the new arrangements, was given a choice between relocation, applying for jobs at HGS and a redundancy package. Khan opted for the voluntary redundancy package but he later claimed unfair dismissal. The EAT agreed with the tribunal that since Khan was offered a variety of options and not just a redundancy package, his was a consensual termination, not a dismissal. 



Khan v HGS Global and Or [2016] UKEAT/0176/15/DM 



www.bailii.org/uk/cases/UKEAT/2016/0176_15_1611.html

Similarly, in Birch & another v University of Liverpool [1985] IRLR 165, the Court of Appeal ruled that employees who accepted early retirement when faced with a threat of compulsory redundancy ended their contracts by mutual consent. They were not dismissed for redundancy.