Employment Alert No. 101: Redundancy: Making Offers Of Alternative Employment
June 16, 2005
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What is the Issue? |
For there to be a fair redundancy dismissal, an employer must show that it has offered suitable alternative vacancies to otherwise redundant employees. Employers do not have to create vacancies or conduct an absolute search. But they must conduct a reasonable search for vacancies to offer otherwise redundant employees. Many employers give a list of vacancies within their business to the employees provisionally selected for redundancy and invite them to respond by demonstrating their interest. If an employee fails to do so, then employers normally proceed on the assumption that the employee is not interested in any of those roles.
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How have the rules changed? |
Case law has already established that employers must give sufficient information to otherwise redundant employees about job vacancies. But the general assumption has been that, if employees express no interest, employers need to do no more.
The recent case of Fisher v Hoopoe Finance Ltd has shown that the law had moved on. It is now essential that, when an employer asks an employee to demonstrate an interest in a vacancy, it must give sufficient information to that employee at the time of making that vacancy list available – in particular, information about pay and benefits etc. If this is not done, the employee cannot make an informed choice. Employers cannot assume, from an employee’s silence, that he is not interested in a job on the vacancy list, where these details about the job are not provided. However the EAT said that a failure by an employee to show an interest in a vacancy could be taken into account when calculating the unfair dismissal compensatory award.
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What should employers do? |
It is now clear that, when notifying otherwise redundant employees of suitable alternative vacancies, employers
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Provide a comprehensive list of the vacancies within the business;
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Attach job descriptions (or at least sufficient job summaries) and the details of the remuneration package;
Where the employees are invited to job search via the employer’s intranet, there can be links to those details. However, some employers may have concerns about remuneration package details being available on their intranet. Instead, they could provide a filtering mechanism so that only those people on the potentially redundant list have access for a temporary period. Alternatively, employers could clearly indicate on both the covering letter to the redundant employees (and also on the list of vacancies) that, if employees are interested in any of the jobs, they must notify the HR department expressing an interest and remuneration details will be provided. The document should also state that failure to do this will be treated as meaning that the employee is not interested. In addition, reference should be made to where the details of the jobs and remuneration package can be found.
Employers have quite a lot of flexibility in when and how job vacancy details are provided. But, in the final analysis, when being asked to indicate whether they are interested in a potential vacancy, employees must be given sufficient information (including the details of remuneration package) to enable them to make an informed choice. Failure to do this runs a risk of finding an unfair dismissal because, at the Tribunal, the employee will assert that he did not have enough information to do so.
Employers might consider it prudent to have a backstop process under which employees, who have not responded to the list of vacancies, are chased up and their written confirmation obtained that they aren’t interested in any of the vacancies. In that chase up process, HR can ask the employees if they need any further details, such as about the remuneration package.
