Redundancy: selection criteria, pools of one and meaningful consultation

A recent Employment Appeal Tribunal decision, Mogane v Bradford Teaching Hospitals NHS Foundation Trust, serves as a reminder of (i) the importance of carrying out meaningful redundancy consultation; and (ii) the risks of using a single selection criterion which leads to a pool of one.

The facts

Ms Mogane was a nurse engaged on a series of one-year fixed term contracts who was unfairly dismissed by reason of redundancy.

She was selected because her fixed-term contract was due to expire before that of another colleague. The end date of her fixed term contract was the sole criterion for selection, adopted without prior consultation, and this inevitably placed her into a pool of one.

When the consultation process started, the decision had already been taken to make her redundant - the only outstanding issue was whether there was any suitable alternative employment.

The importance of meaningful consultation

Individual consultation is fundamental to the fairness of a redundancy dismissal, whether there are collective redundancies or not.

• Consultation must be genuine and meaningful. The employer must have an open mind and still be capable of influence about the matters which form the subject matter of consultation. Any proposals that the employee makes should be taken into account before any final decisions are made.
• Consultation needs to start early enough in the process to allow the employee to potentially sway the outcome. The issue in Mogane was that, by the time consultation had begun, it was already effectively decided that the employee was going to be made redundant so the subsequent consultation was meaningless – in the circumstances it should have started before the pooling decision was made.

Pools of one

If there is good reason for doing so, employers can consider a single employee for redundancy. For example, there might be a 'pool of one' where an individual role is no longer necessary, and there is only one employee carrying out that role; or where a number of employees are doing similar roles but each within a specific geographic area and there is no longer a need for that role in one of the areas.

Selecting a pool that is the same size as the number of roles to be made redundant is, however, likely to come under scrutiny. The EAT noted in Mogane that "whilst a pool of one can be fair in appropriate circumstances, it should not be considered, without prior consultation, where there is more than one employee.”

Risks of using a single selection criterion

Redundancy selection criteria must be objective, non-discriminatory and applied fairly. They should also be clear and transparent to employees.

Relying on a single criterion will not necessarily be unfair if there are justifiable reasons for doing so. However, selecting on this basis increases the risk of the process being challenged. In the Mogane case, only using the date of a fixed term contract ending was found to be "entirely arbitrary" and so unfair.

Where possible it is good practice to use several criteria which can be independently verified – such as skills, performance, relevant experience, qualifications, disciplinary or attendance records for example.

Risks of basing selection on fixed-term status

The non-renewal of a fixed-term contract when it comes to an end will often be by reason of redundancy - for example where an employee was employed for six months to complete a particular task and that task has been completed. In these circumstances, selection for redundancy will usually be straightforward.

However, if a fixed-term employee is made redundant before the end of their contract, a blanket policy of making fixed-term employees redundant before permanent employees could be in breach of the Fixed-term Employees Regulations (for which there is no minimum service requirement). It might also risk unfair dismissal claims from fixed-term employees with two years' service.

More information

For more information on following a fair redundancy process, please contact a member of our Employment and Immigration team.

FAQs and templates, including a consultation schedule and selection matrix, are available on the Redundancy pages of Workbox by Brodies, our award-winning online HR and employment law site.