UK: Redundancies – when a redundancy situation arises

Ms Jackson was the Managing Director. But after the company’s owner became CEO, he took control of management decision-making and operations, and undermined her position as MD. She was dismissed for redundancy on the basis that the company’s requirements for employees to carry out work of a particular kind had diminished, and brought a claim for unfair dismissal.

The EAT stated that a redundancy situation “exists or it does not”. The issue was whether the company’s requirement for employees to carry out particular work had diminished. If that occurs, the company’s motive is not relevant to the question of whether the redundancy situation exists.

The EAT found that the company’s requirement for employees to carry out work of a particular kind, undertaken by the MD, had diminished which created a redundancy situation.

Practical point

The motive behind a redundancy situation, and the manner in which it arises, will not affect whether there is a genuine redundancy situation. That said, the motive may be relevant in determining whether the dismissal was fair.

Berkeley_Catering_Ltd_v_Mrs_J_Jackson

For more information on these articles or any other issues involving labour and employment matters in the United Kingdom, please contact Robert Hill (Partner) at Clyde & Co at robert.hill@clydeco.com or visit www.clydeco.com.