Following correct procedure is an integral component of any tribunal decision when determining whether a dismissal was unfair. In a redundancy situation, even in cases where there has been a genuine redundancy, these have consistently been found as unfair by Tribunals where fair procedure has not been adhered to by the employer.
This piece examines the case of Dalton v Bond Delivery Ireland Ltd. (UD 658/2009) which demonstrated that where an employer follows correct procedure in a redundancy process they will receive the correct result.
Background: The Redundancy
The claimant in this case was employed as an Office Manager in the employer’s storage and distribution Company. Following a downturn in the business and the loss of one of their customers, the Company was forced to instigate compulsory redundancies to determine where the redundancies would fall.
The Redundancy Procedure Followed
The Company introduced a consultation process between Management and a Works Committee on behalf of employees to handle the redundancy situation. The Company assessed that it would not be possible to maintain both of the posts held by the employee (Ms Dalton) and the Transport and Administration Manager (JAJ), and that one position would have to be made redundant.
The Company made their selection for redundancy by implementing a skills matrix, of which both employees were made aware. The employees were informed that there would be a 30 day consultation and they were also asked to propose any possible suggestions. The matrix was separated into various categories of work (including general management, transportation and administration) and points were allocated by the witness and Operations Manager dependent on the employee’s abilities.
In relation to the skills matrix, it was found that Ms Dalton had longer service than JAJ. The claimant was awarded zero for timekeeping (but the HR Manager admitted she had never been disciplined in this area nor was she offered a copy of her timekeeping records after the completion of the matrix report). The Operations Manager referenced the transportation element of the matrix as being integral, an area which the claimant had not scored well in.
As a result of the matrix procedure, Ms Dalton was deemed to have scored a lower number of points and was made redundant. She was also offered an alternative position within the Company as an Office Administrator (which involved a decrease in salary of €3,000) which she rejected, and she did not invoke her option to appeal against this decision.
She cited her lack of understanding of the skills matrix procedure, disappointment with the emphasis on the transport aspect of the job, unwillingness to be demoted and lack of faith in the Company grievance procedures in response to the decision to make her redundant.
EAT Determination
The EAT considered the above evidence and was satisfied that the Claimant was not unfairly selected for redundancy and her claim under the Unfair Dismissals Acts 1977-2007 failed. Ms. Dalton’s claims under the Redundancy Payments Acts, the Minimum Notice and Terms of Employment Acts and the Organisation of Working Time Act also failed.
The EAT considered each step taken by the employer in implementing the redundancy and stated that the Company’s procedure in this respect was faultless. The Tribunal acknowledged that the Company had given due consideration to the skills matrix used to differentiate the two employees and determine the redundancy.
While the EAT conceded that there was possibly an emphasis on the transportation element of the position (an area in which the claimant was not proficient) and sympathised with the claimant’s belief that she had been unfairly selected for redundancy, they referenced the Company’s entitlement to deem this element a significant aspect of the position that remained. They were therefore unable to deny that the Company had complied with fair procedure and could not substantiate the claimant’s allegation that Management had a preconceived agenda to make her redundant. The EAT emphasised the offer of alternative employment made to the claimant which she rejected, and also the fact that the claimant had been afforded the opportunity to appeal the decision, but failed to do so.
Correct Procedure, Correct Result
EAT determinations regularly cite the requirement for a fair and reasonable redundancy procedure to deem a dismissal fair, although currently there is no Code of Practice to guide employers in this regard. When an employer is seeking to justify a dismissal on the grounds of redundancy, a fair, reasonable and justifiable selection criteria is intrinsic in avoiding an unfair dismissal claim.
Even where there is a genuine redundancy situation, if the redundancy selection process is unfair, an employee will succeed in a claim for Unfair Dismissal. Therefore an employer must have genuine grounds as well as ensure the procedure is procedurally fair.
Where there is a need to make a role redundant and there are two or more employees engaged in similar employment, an objective selection criterion must be adopted to fairly select the employee to be made redundant, and this criterion should be given examined extensively from the outset to ensure impartiality. Employers should preferably avoid subjective criteria and a selection criterion should be verified with objective data which should be applied consistently in order to weaken an employee’s claim of unfair selection.
There are fundamental principles to be followed in general when dismissing an employee due to redundancy:
1. There must be substantial grounds justifying the dismissal;
2. The employer’s conduct must be reasonable – consult with the individual employee in advance and in the case of a collective redundancy an employer must engage with representatives of the employees affected at least 30 days before the first notice of dismissal is given. You should also outline the redundancy process to the employee from the outset.
3. Discuss alternative positions with the employee, consider the employee’s own proposals or discuss making changes to their terms and conditions of employment with agreement e.g. salary, working hours
4. The selection process observed must be fair and in particular does not breach any of the statutory prohibitions or any procedures that apply within the particular employment, either by agreement or through custom and practice.
5. Employees must be made aware of the applicable selection criteria prior to the commencement of the redundancy process and must have the opportunity to comment on how this is applied to them.
If you have any queries or concerns in relation to the matter of Redundancy please don’t hesitate to contact the Peninsula Advice Service on 01 855 5050 and speak to one of our advisors.
