Reorganisations

Where an employer wants fewer employees overall, a redundancy situation is usually obvious. The position is less straightforward where the employer reorganises work, retaining the same number of employees to do different jobs. Generally speaking, there will be a redundancy situation where a particular kind of job has disappeared altogether, but if it has only been changed in part, for example through the introduction of new technology, it will be a question of fact whether this amounts to a redundancy, depending on the extent of the change.

For example, in Murphy v Epsom College [1984] IRLR 271, the dismissal of a plumber, after the college installed a new heating system he was not qualified to operate, and his replacement with a heating engineer, was a redundancy dismissal.

An employer need not provide evidence of financial problems to justify making redundancies. Indeed, there can be a redundancy situation where a successful employer with plenty of work decides to reorganise, as long as that reorganisation means a cut in the number of employees needed to do work of a particular kind (Kingwell v Elizabeth Bradley Designs EAT/0661/02). For example, a successful business may need to make redundancies after introducing new technologies.

However there cannot be a redundancy situation if, after a reorganisation, there is “just as much work of a particular kind for just as many employees” (Packman t/a Packman Lucas Associates v Fauchon ([2012] UKEAT/0017/12/LA).

Even if there is no redundancy situation, a member may still have a claim for unfair dismissal for “some other substantial reason” (section 98(1)(b) ERA 96).

Even though a tribunal must not second-guess an employer’s commercial judgment that redundancies were needed, it must carefully scrutinise the employer’s reasoning to satisfy itself that redundancy was the real reason for dismissal, and not some hidden reason, such as capability, whistleblowing, discrimination or personality clashes. Manufacturing a sham redundancy situation to engineer a dismissal is unfair.