This was the question that the Employment Appeal Tribunal had to resolve in the case of Green v London Borough of Barking and Dagenham.
The Employee – Ms Green – was employed by the Council from August 2008 until her dismissal on 25th July 2014. The dismissal took place when the Council undertook a restructuring exercise that led to the deletion of three positions. The Council created two new positions, that the three potentially redundant members of staff were able to apply for by way of competitive written tests and interviews. Ms Green scored the lowest in the interview and written tests and was accordingly dismissed as redundant. She complained to the Employment Tribunal asserting that one of the other employees had an unfair advantage in the written test, due to prior knowledge of the issues ventilated in the written test.
The Employment Tribunal found Ms Green’s claims not well founded, particularly applying the previous EAT decision in Morgan v Welsh Rugby Union (which appeared to approve a competitive interview process when new positions were created).
Allowing the appeal the EAT found that the Employment Tribunal had fallen into error by regarding Morgan v Welsh Rugby Union as creating a rule of law. The correct approach – said the EAT – was to go back to the source material at s.98 (4) Employment Rights Act 1996:
“…the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer: -
a) Depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonable in treating it as a sufficient reason for dismissing the employee, and
b) Shall be determined in accordance with equity and the substantial merits of the case.”
To put it another way the correct legal approach is to go back to older redundancy principles: consultation with potentially redundant employees, proper selection of the redundancy pool, fair selection of potentially redundant employees from the pool, consideration of alternatives to redundancy etc.