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29 January 2013

Consultation before redundancy not always required

An employer does not need to consult with an employee before making him redundant if it would be 'futile' to do so, according to a ruling of the Employment Appeal Tribunal (EAT).

In the case of Ashby v JJB Sports plc, a senior manager was made redundant after a more experienced and better-qualified employee was recruited to fill a new and more senior role which included part of the senior manager's job. The new role had been created as a result of a major restructuring following a significant reduction in business during the economic downturn. The new role was not advertised, and the senior manager was neither told of it nor offered an interview. Other parts of the senior manager's job were taken on by other managers.

He claimed unfair dismissal on grounds the employer should have consulted with him before making him redundant, and should have considered him for the new role. The Employment Tribunal (ET) said this would have served "little purpose and would have been a sham which would not have been to the claimant's benefit". It dismissed his claim.

On appeal, the EAT agreed with the ET, that consultation would have been futile. It ruled this was "far from the ordinary case of redundancy selection; it concerned a manager in a very senior post which was being lost due to a substantial reorganisation".

Employment law partner Jo Davis concluded: "Employers do not always need to consult with employees before making them redundant, for example, if it would be futile to do so. However, they should ensure the circumstances warrant not consulting before they go ahead with redundancy. If in doubt, employers should take specialist legal advice."

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