Semple Fraser LLP v Daly

In a redundancy dismissal, the tribunal must decide whether the employer acted reasonably under Employment Rights Act 1996, section 98(4). It must not substitute its own assessment of employees’ scores or ask whom it would have selected. Detailed scrutiny of scoring is exceptional and requires a sound evidential basis, such as an ulterior motive or an unreasonable system. Equal scores do not, without more, establish unfairness. The tribunal must stand back and assess whether the dismissal fell within the band of reasonable responses available to a reasonable employer.

An employee was selected for redundancy from a pool of two solicitors after the employer applied and moderated a structured scoring system. The Employment Tribunal accepted the criteria but re-marked the successful candidate’s scores for mentoring and business development, producing an equal score. It concluded that the claimant had therefore been unfairly selected and deferred remedy.

The employer appealed, arguing that the tribunal had substituted its own judgment, conducted an impermissible re-assessment and failed to apply the statutory reasonableness test. The central issues were whether equal scores established unfairness and whether the tribunal was entitled to re-mark the criteria.

1. Appeal allowed. The Employment Tribunal’s conclusion that equal scores necessarily made the dismissal unfair was perverse. A genuine redundancy required one of two employees to be dismissed. Equal scores did not show that dismissing this claimant, rather than the other employee, was outside the range of reasonable responses.
2. Under section 98(4) of the Employment Rights Act 1996, the question is whether the employer acted reasonably in treating redundancy as a sufficient reason for dismissal. The tribunal must not substitute its own decision for that of the employer. The concept of reasonableness recognises a band of reasonable responses, within which different reasonable employers may reach different conclusions.
3. Detailed scrutiny or re-marking of redundancy selection criteria is rarely appropriate. It requires a sound basis, such as evidence of an ulterior motive or an intention to manipulate the system to produce a particular result. Mere suspicion is insufficient. The tribunal had found no deliberate favouritism, ulterior motive or unfair administration.
4. The tribunal wrongly treated appointment as a mentor as incapable of attracting points without completed mentoring activity. The guideline was reasonably capable of being read as referring to appointment and the responsibility conferred. It was not open to conclude that no reasonable employer could award a point on that basis.
5. The tribunal also wrongly treated a strong track record of business development as necessarily requiring more than one transaction. The guideline allowed judgment according to the individual circumstances. A reasonable employer could regard a client following an employee from a previous firm, with resulting business, as evidence supporting the score.
6. The tribunal failed to stand back and consider the employer’s overall process, including notice, consultation, the uncriticised pool, structured criteria, moderation, absence of ulterior motive and honest scoring. On the facts found, the only conclusion open was that the dismissal was fair. The claimant’s claim was dismissed.

• Employment Appeal Tribunal: allowed the employer’s appeal from the Employment Tribunal’s judgment registered on 27 July 2009 and dismissed the claimant’s unfair dismissal claim.