Many employers, especially in the current uncertain times of pandemic, find themselves in the position of having to restructure their businesses. Redundancies are a sad but all too familiar aspect of the process, but what happens when the new business structure has a need for roles that are very similar to those that have just been declared redundant and the ideal potential candidates are right there in the current versions of those roles?
The controversial ‘fire and rehire’ process is one possibility for employers who need staff in existing key posts but, in order to save costs, need to change the terms of the employment contracts for those posts. This creates a circumstance where an employee may be made redundant and then given the chance to apply for what is essentially their old job back on revised terms. It is frequently a difficult and delicate process, so any employer considering it would do well to take note of a recent ruling by the Employment Appeal Tribunal (EAT) on what constitutes correct procedure.
The case was that of Gwynedd Council v. Barrett and one other. Gwynedd Council decided to close a number of its primary schools and form them into one new and larger school. A number of redundancies within the teaching staff were necessary, but the Council decided against devising a scoring system to identify candidates and, instead, announced that the new school would be staffed via an application and interview process. Shelley Barratt and another teacher, both employed at the schools to be closed, applied for jobs at the new one but were unsuccessful.
The Council offered no right of appeal or any form of consultation and the employees, as a result, were made redundant. They then brought claims for unfair dismissal. At the initial tribunal their claims were upheld, on account of the tribunal’s finding that the competitive interview process and lack of consultation was unfair. Gwynedd Council appealed that decision.
The EAT upheld the claims and provided useful context for why the process was unfair. It felt that a key aspect of the matter was that the employees were, in effect, being asked to apply for the same jobs, or very nearly the same jobs, as they were already doing. These were not genuinely new posts. The EAT had no problem with an interview process as such, but it felt that this should be used only where posts on offer are genuinely new. In such instances selection from a competitive pool with no consultation or appeal procedure may be acceptable, but where current employees are being asked, effectively, to apply for their own jobs it is not.
This is an important reminder to employers of the need to ensure that redundancy processes are fair. In most cases, a scoring system to identify potential candidates will be best practice. Where genuinely new posts are being created interviews may be acceptable. But when what you are trying to do is ‘fire and rehire’ the same post, no matter the individual circumstances or reasons, interviews are not a valid way to proceed and there will always need to be a consultation and appeal process.
