Case number: 1501249/2006
Date Judgment Sent: 15 December 2006
The unanimous judgment of the Employment Tribunal is:-
(1) as conceded by the Respondent, the dismissal of the Claimant was automatically unfair by reason of a failure by the Respondent to comply fully with Step 2 of the statutory dismissal procedures;
(2) the reason for the dismissal was redundancy, arising out of a re-organisation;
(3) but for the failure to fully comply with Step 2, the dismissal procedures followed by the Respondent would have been both procedurally and substantively fair;
(4) the Claimant having received a redundancy payment and payment in lieu of notice and the Employment tribunal being satisfied that the Claimant would have been dismissed at the same time and upon the same terms as occurred in any event, no award of compensation is made to the Claimant.
1.1 The Tribunal must establish the reason for the dismissal of the Claimant. The Respondent contends that the reason for the dismissal was redundancy. Reference was made to Section 139 Employment Rights Act 1996 which states:
"... an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to -
(a) ??
(b) the fact that the requirements of that business -
(i) for employees to carry out work of a particular kind, or
(ii) for employees to carry out work of a particular kind in the place where the employee was employed by the employer,
have ceased or diminished or are expected to cease or diminish."
1.2 Further, the issue is whether the dismissal was carried out with fairness pursuant to section 98 ERA 1996 and procedural fairness pursuant to section 98A ERA 1996 and the procedures set out in Part I of Schedule 2 of the Employment Act 2002.
1.3 At the outset, the Respondent conceded automatic unfair dismissal for failure to fully comply with the requirements of the Step 2 meeting, citing Alexander & Another -v- Bridgen Enterprises Ltd [2006] IRLR 422.
1.4 In spite of their concession, the Respondent contends that the dismissal of the Claimant was otherwise fair and that had the proper procedure been carried out the Claimant would have been dismissed on the grounds of redundancy in any event. (Section 98A(2) ERA 1996).
2.1 Reference was made to an agreed bundle of documents. Evidence was heard from the Claimant on his own behalf and from Mr Charles Maltby, Engineering Diector and Mr Simon Woodward, Chief Executive Officer of the Respondent.
2.2 The Respondent is a global provider of software, solutions and services fo commercial deployment in the digital TV and home entertainment electronics markets, and employed 48 people at the relevant time.
2.3 The Claimant, who was born on 29 April 1946, commenced employment with the Respondent on 2 October 2000. After a change in his role, his job title was Customer Support Engineer and Technical Support Manager. He reported to Mr Maltby through his immediate Manager, Mr David Bell.
2.4 The Claimant felt unappreciated due to his contention that, whilst by the end of 2005 his workload had effectively doubled, his salary had not kept pace with inflation. Mr Bell, carried out the Claimant's 2006 appraisal (pages 76-79 of the bundle). Mr Bell retired and left the Respondent not long thereafter.
2.5 In late 2005/early 2006, the Respondent undertook a review of its provision of customer support. The Claimant had been involved in changes with regard to customer support arrangements on three occasions during his term of employment. Evidence by Mr Maltby that a change was needed to the approach to customer support was not challenged by the Claimant and accepted.
2.6 By way of restructure, the Respondent considered that it would be appropriate to create a new role which would combine a numbe rof aspects of both the Technical Support Manager/Customer Suppot Engineer and the Technical Account Manager roles. This was with particular reference to the European, the Middle Eastern and African market, known as the EMEA. One significant aspect of the proposed new structure was that it would eliminate overlap and only one person would be employed in the EMEA region to carry out the new role. The Board of the Respondent approved the proposed restructure in mid-March 2006 (pages 80 - 81) and Mr Maltby, in conjunction with the recently-recruited Sales Director, Colin Shave, drafted a job description for the new role which was named Technical Account Manager/Europe, Middle East and Africa (TAM EMEA).
2.7 The three potential candidates for the TAM EMEA position were Toby Douglass, formerly a Customer Support Engineer, Nicholas Wilkinson, formerly a Technical Account Manager, and the Claimant.
2.8 On 23 March 2006, the Claimant Toby Douglass and Nicholas Wilkinson attended a meeting with Mr Maltby, Mr Shave and Suzanne Hopkins, the Human Resources Manager, when the restructure and redundancy implications were explained. They were each given a copy of the job specification for the new role and the criteria against which each would be assessed were outlined. It was explained that the two people who were unsuccessful would be potentially redundant. They were invited to consider any alternative employment available and encouraged to consider alternative roles. Almost immediately, Toby Douglas indicated his wish to volunteer for redundancy leaving the new post to be contested between Mr Wilkinson and the Claimant.
2.9 Subsequently, the Claimant, accompanied by Toby Douglass, attended a further meeting with Mr Maltby and Suzanne Hopkins on 24 March when the Claimant sought further information and the selection criteria were discussed. Mr Maltby explained that he and Colin Shave would independently score both him and Nicholas Wilkinson. The person who scored the most would be appointed to the role and the other would be potentially redundant.
2.10 Evidence by Mr Maltby that the Claimant had commented that he considered that the selection process that was being followed was fair and that the Claimant had not raised any concerns or asked any questions about it were not challenged by the Claimant. Nor did the Claimant challenge evidence given by Mr Maltby that the Claimant confirmed that he understood the reasons for the restructure and was supportive of the poposal.
2.11 With regard to alternative employment, the Tribunal finds that there were in fact no suitable vacancies for which the Claimant could have been considered. Possible vacancies included General Counsel (to which post a barister of ten years' experience was appointed), an Accounts Assistant (in whi hthe Claimant was not interested) and a Software Architect (for which a particular recruitment had been ongoing for some time and for which the Claimant was not considered a serious contender, by him or anyone else).
2.12 There were also posts in China and the USA but the Tribunal find that the Claimant was not a suitable candidate for these posts either.
2.13 Prior to the completion of the selection criteria scores by Mr Maltby and by Mr Shave, the Claimant had an opportunity of considering those criteria. He did not make representations for changes, although he had been provided with reasonable opportunities to do so.
2.14 On 2 April 2006, Mr Maltby, having completed his scores for the Claimant and Nicholas Wilkinson (page 98), and scored 52 for the Claimant and 69.5 for Mr Wilkinson, sent an e-mail to Mr Shave, who happened to be on holiday in Barbados at the time. With his e-mail, Mr Maltby sent a blank table for scoring for the TAM role, but unwisely mentioned his scores, although he did not identify which score was attributable to which candidate. This was certainly unfortunate and ill-advised, but the Tribunal find that it was not significant enough to render the entire selection process unfair.
2.15 Mr Shave scored 68.5 for the Claimant and 79 for Nicholas Wilkinson (page 103).
2.16 The Claimant met with Mr Maltby and Suzanne Hopkins on 6 April 2006. Mr Maltby gave to the Claimant a copy of the pro forma selection criteria and informed him of the average score, being 74.25 to 60.25 in favour of Mr Wilkinson, but made a conscious decision not to allow the Claimant to see the actual breakdown of his scores. This was conceded by the Respondent as being in breach of Step 2 of the statutory dismissal procedures.
2.17 On 6 April, Mr Maltby wrote to the Claimant confirming his selection for redundancy and setting out the payments he would receive, including a statutory redundancy payment of £2,175 and an ex gratia payment of £1,000 (the latter being to enlist the co-operation of the Claimant with regard to handover). The Claimant was informed of his right of appeal to the Chief Executive Officer (pages 124 and 125).
2.18 On 25 April 2006, the Claimant notified Suzanne Hopkins (Murphy) that he wished to appeal against the decision to terminate his employment on the grounds that it was unfair. He gave no further particulars of the reasons why he considered the dismissal unfair and declined a request to do so (page 159).
2.19 The Claimant's appeal was heard by Mr Woodward on 3 May 2006 (minutes pages 163 - 200). the Claimant was accompanied.
2.20 Mr Woodward reiterated that the redundancy had aisen in response to changes which were customer-driven and were not to save money. All points raised by the Claimant by way of appeal were carefully considered and dealt with by Mr Woodward. At his request, the Claimant was shown his scores against the selection criteria, at which point he made it abundantly clear that he did not agree wit the scorings shown on the sheet which had been given to him by Mr Maltby and Mr shave. However, Mr Woodward insisted that he was satisfied that there had been an objective assessment of the scores, that he was satisfied that the process had been conducted fairly and indeed also indicated that in his view Mr Wilkinson was technically better qualified for the new post.
2.21 Although the Claimant, at the appeal hearing, made a number of criticisms of management decisions, he did not allege that the entire process of restructuring and his selection for redundancy was a "sham" orchestrated for the sole purpose of getting rid of him.
2.22 The Claimant did not put contentions that the whole episode had been a sham to either Mr Maltby or to Mr Woodward when they were cross-examined by him.
2.23 Mr Woodward upheld the decision toterminate the Claimant's employment by reason of redundancy and dismissed his appeal. The Tribunal finds that the restructure was genuine and that the creation of the role of TAM EMEA was not a sham set up with the objective of dismissing the Claimant.
2.24 Contentions by the Claimant that he had been unfairly treated in comparison to another colleague, Justin Topham, for whom a new role had been created when his job was put at risk of redundancy and further assertions by the Claimant that he had been targeted as an under-performer and because he had not received a salary increase in January 2006, were considered and held by the Tribunal not to justify a finding of unfairness in favour of the Claimant.
2.25 The Tribunal indeed noted that the Claimant was not someone who would suppress comments or criticisms when he felt aggrieved or concerned. For example, on 1 March 2006 the Claimant had made a lengthy response when invited to provide a Vision statement for the Respondent (pages 74 and 75). furthermore the Claimant was not in any way short on words during his appeal hearing, but failed to establish any grounds upon which Mr Woodward might have been expected to uphold his appeal and reverse the decision that his job was redundant. During the consultation period, the Claimant was noted to have been far less proactive than Nicholas Wilkinson in terms of asking questions about the new role and demonstrating what he could bring to it. The Claimant is a man of undoubted intelligence and of considerable ability with a number of impressive qualifications. Nevertheless, the Tribunal find that overall, even allowing for the failure by the Respondent to show the Claimant his marks during the consultation process, this did not make any significant difference whatsoever to the decision that the Claimant's job was redundant.
3.1 Reference has already been made to Section 139 ERA 1996.
3.2 Even where the reason for the dismissal is established as redundancy, there are statutory requirements that the procedures followed must be fair. Where there has been procedural unfairness, there will also be the question which is relevant under the principles in Polkey v A E Dayton Services Limited (1987) IRLR 503HL as to what the chances were of the Claimant being dismissed even if proper procedures had been complied with.
3.3 The relevant legislation includes Section 98(4) ERA 1996 which states -
"Where the employer has fulfilled the requirements of sub-section (1) the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer) -
(a) Depends on whether in the circumstances (including the size and administration of the employer's undertaking) the employer acted reasonably or unreasonbly in treating it as a sufficient reason for dismissing the employee, and
(b) Shall be determined in accordance with the equity and substantial merits of the case."
3.4 Section 98A ERA 1996 makes further provisions about procedural fairness as follows:
"(1) an employee who is dismissed shall be regarded for the purposes of this Part as unfairly dismissed if -
(a) One of the procedures set out in Part 1 of Schedule 2 of the Employment Act 2002 (Dismissal and Disciplinary Procedures) applies in relation to the dismissal;
(b) The procedure has not been completed, and
(c) The non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements.
(2) Subject to sub-section (1), failure by an employer to follow a procedure in relation to the dismissal of an employee, shall not be regarded for the purposes of Section 98(4)(A) as by itself making the employer's action unreasonable if he shows that he would have decided to dismiss the employee if he had followed the procedure.
(3) For the purposes of this section, any question as to the application of a procedure set out in Part 1 of Schedule 2 of the 2002 Act, completion of such a procedure or failure to comply with the requirements of such a procedure shall be determined by reference to regulations under Section 31 of that Act."
3.5 The decision of the EAT in Alexander & Another v Bridgen Enterpises Limited, in a reserved judgment given on 12 April 2006, held (inter alia) that in a redundancy situation the employer should notify the employee of the selection criteria which have been used, and also the assessment of the employee. That will give the employee an opportunity to make representations not only about whether the criteria ae justified and appropriate, but also, more importantly, whether the marking given to him in respect of any particular criterion is arguably unjust, and why. In order to comply with the statutory procedure, however, it is not necessary to provide the assessments of other employees who are at risk of redundancy.
3.6 The Judgment also explained the effect of Section 98A(2) and the so-called "Polkey - Reversal" whereby, if the employer has failed to comply with a procedure that ought to have been carried out, that will not render the dismissal unfair, if the employer shows that the employee would have been dismissed anyway even if that fair procedure had been adopted.
4.1 The Claimant submitted that the consultation process was a sham arising from a chain of events that had started in 2005 and that he had been singled out. He submitted that proper consideration had not been given to his skills and that another position could and should have been created for him.
4.2 Counsel for the Respondent followed her written submision that in spite of the dismissal being automatically unfair, as conceded, overall the dismissal of the Claimant on the grounds of redundancy would have occurred in any event and that the Claimant is not entitled to any compensation beyond the payments already received by him.
5.1 The unanimous judgment of the Employment Tribunal is that the reason for the dismissal of the Claimant by the Respondent was redundancy. The reorganisation by the Respondent of its provision of customer support meant that the Claimant and two other colleagues were put at risk of redundancy, there being three employees in the selection pool competing for the one job, TAM EMEA. When one candidate volunteered for redundancy, that left two, Mr Wilkinson and the Claimant. The selection criteria drawn up by the Respondent were fair and there was proper consultation with the Claimant concerning the selection criteria and indeed the entire restructuring process.
5.2 As was conceded on behalf of the Respondent, the Respondent did fail to comply with a fair procedure under step 2 of the statutory dismissal procedures in that the Claimant was not shown his scoring against each criterion. However this was partially remedied, at least, at the appeal hearing when Mr Woodward did show the Claimant his scores.
5.3 The unanimous judgment of the Employment Tribunal is that, in spite of the dismissal being automatically unfair, the Claimant would inevitably have been dismissed for redundancy in any event. The Respondent was entitled to the view that Mr Wilkinson was the preferred candidate. The Tribunal is not entitled to enquire into or accept a challenge of the respondent's markings of the candidates against the selection criteria. There was no evidence to show that the marks as awarded by Mr Maltby and Mr Shave were not genuine, nor was there any persuasive evidence of the restructuring of the customer support function being no more than a contrived and cynical sham concocted for the sole objective of dismissing the Claimant. It is 100% certain that the Claimant would have been made redundant, even if his scores had been shown to him by Mr Maltby.
5.4 The unanimous judgment of the Employment Tribunal is that there were no suitable alternative vacancies for which the Claimant could or should have been considered. Posts in China and the USA were not available as suitable alternative employment for the Claimant and employees of the Respondent in China and the USA were not appropriate to be included in the selection pool.
5.5 The Claimant having received payment in lieu of notice and his statutory redundancy payment based on five years of completed service, the Claimant is not entitled to a Basic award, nor is he entitled to a Compensatory Award.