In the case of Devon Primary Care Trust v Readman [2013] EWCA Civ 1110 the Court of Appeal were asked to consider the test that should be applied to a situation in which an employee, having been at risk of redundancy, was offered suitable alternative employment, but refused the offer. Was she still entitled to receive a redundancy payment?
Background
The respondent had been employed as a nurse by the trust or its predecessors from 1976. In 1985 she began community nursing and in 1995 was promoted to district nurse team leader. By further promotion the respondent became community modern matron, with the responsibility of running community and district nursing in the coastal locality of Teignmouth and Dornish. She was managing about 120 staff. This was a band 8A professional lead role.
Following an amalgamation of services the respondent was told in November 2007 that she was as risk of redundancy. She was unsuccessful in her application for a Band 8A professional lead role in the new structure and was offered three alternatives. Two of these were at lower grades (Band 7) and were found to be unsuitable because they involved a loss status, a loss of professional lead responsibilities and some financial loss.
The third option was an offer to become a modern matron at Teignmouth Hospital. That was a Band 8A role. The tribunal found that the only difference between this and her earlier employment was in the replacement of 45% of her duties as a community matron by 45% as a matron in a small hospital. The tribunal therefore decided that this was a “suitable offer” within the meaning of Section 141(3) of the Employment Rights Act 196 and this was not challenged on appeal.
The respondent had turned down this offer saying that her career path and qualifications were in community nursing, she had not worked in a hospital since 1985 and had no desire to do so. The tribunal had decided that her decision was unreasonable and thus she had forfeited her right to receiving a redundancy payment (agreed at £8,575).
On appeal the EAT found that the tribunal had applied the wrong test and the Court of Appeal agreed and stated that “the employee’s behaviour and conduct must be judged looking at it from her point of view on the basis of the facts as they appeared or ought reasonably to have appeared to her at the time the decision had to be made”.
In other words “the reasonableness or otherwise of the refusal depends on factors personal to the employee and is assessed subjectively from the employee’s point of view at the time of the refusal”.
Summary
The decision of the Court of Appeal suggests that even if an employer can offer alternative employment which is suitable, it is still going to be at risk of having to make a redundancy payment if the employee has personal reasons for refusing. Employers should be wary of challenging these refusals if there are any other suitable positions which may still be available which might lead to an acceptable outcome.
Other related Articles
- Enhanced redundancy terms by custom and practice (October 2013)