Tribunal prematurely determined issue of redundancy without proper consideration of existence of genuine redundancy situation
The Employment Appeal Tribunal (EAT) has found that the Tribunal adopted incorrect reasoning in a claim relating to pregnancy discrimination by reason of redundancy.
The facts
In Ballerino v Racecourse Association Ltd, the claimant, who worked 40 days a year as a financial accountant, was dismissed during her maternity leave by reason of redundancy. The employer respondent had created a new full-time role which encompassed her duties and also included other strategic responsibilities. Although the claimant was invited to apply for this new position, she was also offered a settlement agreement. She was subsequently dismissed when relations broke down.
The claimant brought claims for pregnancy discrimination and automatic unfair dismissal. The claims were based on the claimant's right, as an employee on maternity leave, to be offered suitable alternative employment to other employees - in the event of a redundancy situation. A failure to offer suitable alternative employment in these circumstances (and where an appropriate vacancy exists) will give rise to a claim of automatic unfair dismissal. In this situation, there is the possibility of uncapped compensation. The same act could also amount to discrimination under the Equality Act.
Tribunal decision
The Tribunal dismissed the claimant's claims. It rejected the claimant's argument that the new role amounted to a suitable available vacancy which should have been offered to her before other candidates. The Tribunal found that a large part of the new role required business analysis skills. The respondent could also provide an acceptable explanation for its decision to re-organise the business. Additionally, the decision to implement the new role was not seen as a device designed to terminate the claimant's contract of employment. The claimant appealed to the EAT.
EAT decision
The EAT upheld the claimant's appeal and remitted the claims. It found that the Tribunal had prematurely determined the issue of redundancy without thoroughly examining whether there was even a genuine redundancy situation. Since the claimant's role was relatively new, it was crucial to assess if a genuine redundancy existed. Additionally, the Tribunal failed to critically evaluate the respondent's rationale for the reorganisation and whether it was genuinely non-discriminatory.
Learning points
As the claim has been remitted, the parties to this litigation are yet to achieve a final resolution in the case. The decision, nevertheless, acts as a reminder of the importance for employers of thinking through whether a redundancy situation exists in any particular scenario. Where staff are pregnant, on maternity leave, adoption leave or shared parental leave, or where they have recently returned from such leave, they will be entitled to enhanced protection in the event of a redundancy situation. Given that the potential consequence of breaching the enhanced redundancy protection provisions is a finding of automatic unfair dismissal, this case also acts as a reminder that employees do not need two years' service in order to qualify for the protection or bring a claim.