It is pretty well-known that when an employee is put at risk of redundancy, the employer is under a duty to consider whether they could be redeployed to an alternative role elsewhere within the business. However, the recent case of Hendy Group v Kennedy suggests this obligation may be rather more extensive than many employers realise.

The facts

The Hendy Group operates numerous franchised car dealerships located across the south of England. Mr Kennedy initially worked for the company as a salesperson before moving to a training role for the last five years of his employment. He was dismissed by reason of redundancy in 2020. 

Perhaps unsurprisingly, the redundancy situation arose largely as a result of the COVID-19 pandemic. Mr Kennedy accepted that the redundancy situation was genuine and that his selection for redundancy was fair. However, he argued that his dismissal was ultimately unfair, not least because his employer had failed properly to consider the prospect that Mr Kennedy could be redeployed to an alternative role elsewhere within the business.

The judgment

When the case came before the Employment Tribunal, the Judge was critical of the way in which the employer had dealt with the issue of redeployment. In particular, the Judge highlighted the following concerns:

• Although the HR Department invited Mr Kennedy to apply for any roles being publicly advertised at the time, no specific assistance was provided in relation to the application process, nor were any particular posts suggested to him; 
• There was a lack of support offered to Mr Kennedy in relation to the application process, despite the fact that multiple sales jobs (for which he had relevant experience) were available within the group at the time;
• Recruiting managers made negative assumptions about Mr Kennedy's motivations for applying for alternative roles and some were unaware that he was at risk of being dismissed;
• Having unsuccessfully applied for a number of sales roles within the business, he was informed by the HR team that any further applications were likely to be similarly unsuccessful.

In light of the criticisms set out above, the Judge found Mr Kennedy's dismissal to be unfair and awarded him full compensation for the financial losses he suffered as a result.

The appeal

The Hendy Group appealed, arguing that the Judge had failed properly to consider whether, despite his criticisms, the company's actions were nevertheless within the ‘band of reasonable responses’ open to an employer. They also submitted that the Judge had wrongly substituted his judgment for that of the employers. 

Having considered submissions from both sides, the Appeal Judge upheld the finding of unfair dismissal and rejected the appeal. 

Counting the cost

Ultimately, the Hendy Group was ordered to pay Mr Kennedy just under £20,000 in compensation. They unsuccessfully tried to argue that, notwithstanding a finding of unfair dismissal, Mr Kennedy should not receive any compensation at all. They argued that even if they had approached the situation differently, he would have been dismissed in any event. The Employment Judge reached the polar opposite conclusion. He decided that had the employer acted appropriately, Mr Kennedy would have inevitably secured alternative employment within the business and would not have been dismissed at all.

So what does this mean?

This case provides a stark illustration of the employer’s obligation to proactively engage with at-risk employees in relation to their potential redeployment to suitable alternative positions elsewhere within the business. It is not enough simply to give an employee a vacancy list and leave them to it. Instead, employers need to:

• Review vacancy lists for themselves and identify roles that may be particularly suitable for the at-risk’ employee;
• Discuss vacancies with the employee to clarify where the person’s interests may lie;
• Encourage a dialogue about the different roles, including those which might involve re-training, demotion and relocation;
• Consider what additional assistance can be provided to the employee in relation to the recruitment process;
• Make recruiting managers aware of the circumstances surrounding the employee's application, including the fact that they are otherwise at risk of being dismissed;
• Avoid making inaccurate assumptions about an employee's motivation to be redeployed into a different role; 
• Think carefully before preferring an external applicant or a current employee who is not at risk of dismissal; and
• Ensure that there is an effective means of communication and support throughout the process. 

All in all, this case underlines an employer’s obligation to ‘go the extra mile’ when supporting those at risk of dismissal by reason of redundancy. 

Need a hand?

If you need advice on a redundancy situation within your organisation, please get in touch. We’re keen to help.