Early Consultation in Redundancy

It has long been established from very early case law that genuine consultation is a key part of any fair dismissal for redundancy, whether dealing with collective redundancy procedures or smaller groups.

The Employment Appeal Tribunal (EAT) in Joseph de Bank Haycocks v ADP RPO UK Limited has considered this area again and reinforced the importance of early consultation.

Joseph de Bank Haycocks v ADP RPO UK Limited

Facts of the case

In 2020, as Covid hit the economy, ADP RPO UK Limited set a timetable for a redundancy process involving the team on the Goldman Sachs UK account. In the case, a subjective matrix was used and the people in the pool were scored very early in the consultations. By the time of the dismissal, the Claimant was unaware of the scores he had achieved.

The EAT on appeal was highly critical of the process used by the company which was more of a US process and was too subjective. Importantly it also went on to make clear the importance of early consultation. Although some matters were rectified on appeal, it could not repair the gap in consultation, that was missed at the earlier stage.

The Judgment looked at previous case law and gave some key principles, amongst others, was the fact that a fair consultation occurs when proposals are at a formative stage and where the employee is given adequate information and adequate time to respond, along with conscientious consideration being given by the employer to that response.

Comment

Employers often query the extent to which they have to consult employees, particularly at an early stage. Clients often come to us explaining that in reality the commercial decisions to close a site or business have already been made. This case confirms that it is always advisable not to make any final decisions until there has been at least some time to explain the proposals to the employees and for them to return with any counter proposals or representations.

Good redundancy procedures involve consultation at every stage, e.g. the proposal itself, the scoring system to be used (before it is used) and the provisional scores when employees are scored, before final scores are confirmed.