Background:

The respondent was a subsidiary of a recruitment company based in the USA. The claimant was part of a small team recruiting for a single client. During the pandemic, the recruitment needs reduced and the respondent decided to reduce its workforce. The parent company provided a process by which to score and select employees for retention. The claimant was last and he was consulted a few weeks later explaining that he was welcome to suggest alternative approaches. Two weeks later he was dismissed. The claimant complained that the dismissal was procedurally unfair due to a lack of consultation and a subjective scoring process.

Outcome:

At first instance the Tribunal found that the claimant failed to show that he should have been ranked higher. As a result, they found the procedure to be fair and reasonable. The claimant appealed to the EAT and was successful. The EAT held the need to consult was part of ensuring that the process was reasonable and in line with the need for reasonableness. Additionally, they held that the subsidiary company using the policy of the parent in the USA which may not reflect good industrial relations as would be expected in the UK.

The employer appealed to the Court of Appeal.  It was held that there was no usual standard of a general workforce consultation. Additionally, there was no presumption of such consultation which would go against the settled case law where it had to be considered on a case-by-case basis. They outlined that consultation should take place at a point in which the employee can realistically influence the decision.  Whilst it had been bad practice to carry out the scoring exercise before the consultation it was important to understand why that was the case. The failure to consult before the scoring did not mean the decision was irrevocable when it transpired he was the lowest scorer. When he was later consulted he could have persuaded the employer that the criteria were flawed and the exercise could have been re-done.  Accordingly, it was held that the employer had conducted a fair redundancy process and the first-instance Tribunal decision was reinstated.

Practical Guidance for Employers:

This case demonstrates the importance of ensuring fairness and reasonableness are in a redundancy process but that it can be less formulaic rather than having set rules about the nature of consultation and when it takes place.  The Court of Appeal does make it clear that it would be better practice to consult before the scoring takes place and that should be an important learning point for HR professionals to take.  An additional learning point is if that has not taken place it does not instantly mean it is a fatal flaw and it could still be fair in terms of consultation post-scoring insofar as it would allow the employee an opportunity to question and persuade.

https://www.bailii.org/ew/cases/EWCA/Civ/2024/1291.html

Jason previously covered this case at EAT level. The Review can be found here:
https://www.legal-island.com/articles/uk/case-law/2024/jan/haycocks-v-adp-rpo-uk-ltd-2023/