Unfair Dismissal Risks in Redundancy Decisions

Failure to meaningfully consider alternative roles led to an unfair dismissal

I see many employers exposing themselves to expensive unfair dismissal claims by the way they consult over proposed redundancies. Fundamental to a reasonable consultation process is properly exploring whether there are alternative roles within the organisation so that the redundancy might be avoided.

The recent case of Hendy Group Ltd v Kennedy is a crucial reminder for employers of this duty.

Mr. Kennedy was made redundant by Hendy Group because of a downturn in business. Although the redundancy itself was genuine and the selection fair, the employer failed significantly in helping Mr Kennedy find another role within the company.

Despite the employer being a large organisation with multiple vacancies, particularly in sales (a field where Mr. Kennedy had extensive prior experience), the Employment Tribunal (and subsequently the Employment Appeal Tribunal) found that the employer's approach to alternative employment was unfair. 

The employer’s key failings included:

• No proactive effort: the employer made no active effort to help Mr. Kennedy identify or apply for other roles. In fact, he was treated no differently from an external applicant.
• Restricted access to information: Mr Kennedy’s access to the company intranet was cut off when he returned his company laptop, hindering his ability to search for internal vacancies.
• Lack of internal communication: No managers were alerted to Mr Kennedy’s risk of redundancy, meaning they weren't prompted to consider him for opportunities.
• Lack of HR support: He received no meaningful HR support in navigating or securing alternative roles.
• Active blocking of applications: Crucially, HR sent Mr Kennedy an email stating he would not be considered for any sales role, effectively ending his prospects of redeployment despite his relevant experience and willingness to take such roles. 

Mr Kennedy’s case reinforces that employers have an obligation to positively and proactively identify and consider alternative employment for employees at risk of redundancy. This duty goes beyond merely signposting available positions. It involves making a genuine effort to try and find them another suitable alternative job.

If you're an employer navigating the redundancy process, it's vital to approach it with care. Make sure you understand your legal obligations—particularly when it comes to considering alternative roles. A well-managed process can help you retain valuable staff, protect your business reputation and avoid costly tribunal claims.

If you need support with redundancy planning, consultation processes, or understanding your legal responsibilities, we're here to help. Please contact us today for clear and practical advice.