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Deciding on the selection pool
Before selection criteria can be applied, the employer must first decide on the group or “pool” of employees from whom redundancies are to be selected. In a unionised workplace, this should be the subject of consultation. If 20 or more employees are at risk, deciding on the pool should be included in the issues for formal collective consultation.
The law gives the employer a great deal of freedom when choosing the selection pool, and a challenge to the fairness of a dismissal on this basis is likely to be very difficult. All the employer must show is that it applied its mind to the question who should be in it and did not discriminate unlawfully (Fulcrum Pharma v Bonassera [2010] UKEAT/0198/10). A tribunal is only likely to interfere if a decision is so flawed that no reasonable employer could have made it (Capita Hartshead Limited v Byard [2012] UKEAT 0445/11).
The pool does not have to include only employees who are doing the particular type of work that has reduced, especially if roles are interchangeable. Indeed, restricting the pool in this way may make the dismissals unfair. For example:
A printing company made redundancies in its finishing department but decided on a pool made up only of employees who had worked on the “perfect-binding” machine, for which they had been given specific training. The EAT said this was unfair because the employees selected for redundancy were the most experienced workers, undertaking all aspects of finishing work, who spent only a third of their time on that machine.
Hendy Banks City Print Ltd v Fairbrother & others EAT/0691/04
In Contract Bottling Limited v Cave [2013] UKEAT/0525/12/DMA, a decision by a soft drinks manufacturer to include every single member of staff in the pool even though they all had completely different skills was described by the EAT as “rather surprising” and unusual but not unfair. In this case, the employer needed to cut costs and in particular employed too many administrative staff. The employer followed a selection procedure that involved scoring every member of staff irrespective of their skills or competencies, making the lowest scoring employees redundant and re-training the surviving staff, even “for example, a warehouse manager retrained to do accounting work”. Although other procedural defects made the dismissal unfair, the choice of a pool comprising every single member of staff regardless of skills was not of itself unfair. There is an overlap here with the practice known as “bumping”, described in chapter 1.
An employer’s desire to avoid demoralising or worrying other employees by placing them in a pool at risk of redundancy is never a fair reason for limiting the pool.