FC Employment Judgment: Unfair Dismissal

The EAT considered whether the refusals of offers of "suitable employment" were unreasonable and therefore excluded the claimants from an entitlement to redundancy payments under s 141 Employment Rights Act 1996. The claimants had initially been employed in roles with the title Head of Human Resources before these roles became redundant due to a restructuring. They were offered alternative employment as Senior HR Leads, which they initially refused. The employer argued that those offers of alternative employment were offers of suitable employment, and that the claimants had unreasonably refused them, with the result that they were disqualified from receiving redundancy payments. The employment tribunal, at the first merits hearing, accepted the employer's argument, but the claimants appealed. The EAT upheld that appeal and remitted the case to the employment tribunal to consider afresh both the question of the suitability of the roles and whether the claimants had been unreasonable in refusing them. At the remitted hearing, the employment tribunal found once again that the offers were offers of suitable employment, but on this occasion found that the claimants were nonetheless not unreasonable in refusing them, so that they remained entitled to redundancy payments. The employment judge's reasoning for this was that while the claimants' perception that there would be a loss of autonomy or status in the new position was not objectively correct, their perceptions were not groundless from their point of view. Following Bird v Stoke-On-Trent Primary Care Trust (2011) UKEAT/0074/11/2107, even if there was no actual loss of status it is possible for an offer of suitable employment to be reasonably refused on the grounds of the employee's contrary personal perception on the question of status.

The trust appealed to the EAT on the sole ground that the tribunal erred in concluding that the respondents did not unreasonably refuse the offer of suitable employment, because it misdirected itself that its findings on suitability were not relevant to reasonableness and failed to correctly consider how the facts "ought to have appeared" to the claimants. The EAT dismissed the appeal, finding that the employment judge had sufficient regard for the findings of fact made regarding the suitability of the roles when he found that the claimants' refusal had not been "unreasonable". It was further found that there is no requirement that an employment judge asks in every case how the facts "ought to have appeared" to the employee; these words are guidance that assists in applying the statutory test of whether the role was unreasonably refused, but do not set out a statutory test themselves. The employment judge had correctly applied Bird and Cambridge and District Co-operative Ltd v Ruse [1993] IRLR 156 in focusing on whether or not the employees' perceptions regarding loss of status were "groundless from their point of view" to assist him in analysing whether the refusal of the role was unreasonable under the statutory test. The EAT therefore upheld the tribunal's decision, and it was found that the claimants were entitled to statutory redundancy payments.

For the question of unreasonable refusal of offers of suitable employment, see Redundancy, Q&A here (subscription required).

First published on the Employment News Service on 8 September 2023.


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