Procedurally flawed redundancy is fair

EAT rules redundancy dismissal is fair despite absence of consultation 

In Ashby v JJB Sports, the Employment Appeals Tribunal held that the dismissal of a senior employee for redundancy was fair, even though there had been no consultation. 

At the time of his redundancy, Ashby was an associate director of JJB Sports and head of human resources and payroll. A new CEO was brought in, who created a new role of HR director. A significantly more highly-qualified person was hired for that role and Ashby, who was not aware of the restructuring of the company, was then made redundant without any form of consultation. He claimed unfair dismissal.

The employment tribunal decided, and the EAT subsequently agreed, that the dismissal fell within the limited number of situations where consultation would have made no difference to the outcome. The EAT held that this was far from an ordinary case of redundancy, in view of the company’s need to implement a radical and urgent reorganisation to protect itself from insolvency. It considered it reasonable that Ashby was not involved in “highly sensitive commercial decisions” and the company’s decision not to appoint him to the role of HR director was held not to be unfair, particularly as it was clear that the other candidate possessed superior experience and skills. 

The EAT stressed that this case was unusual but, even so, employers should treat it with enormous caution, perhaps verging on suspicion. It is difficult to see why the EAT came to the decision it did, particularly with regard to its conclusion that the circumstances of this particular case can be described as ‘exceptional’, simply because they involved a senior employee and a substantial reorganisation of the business. 

The “futile” exception identified in Polkey is rarely successfully argued and employers would be wise not to assume it can be relied on. For the time being at least, and notwithstanding this case, consultation remains a fundamental feature of a fair redundancy process. 

Paul Mander (co-head) and Anna Henry (trainee) are part of the employment team at Penningtons