Family Mosaic Housing Association v Badmos

In an ordinary unfair-dismissal redundancy case, the choice of selection pool is primarily for the employer. The Employment Tribunal must scrutinise whether the employer genuinely addressed that question, but must not substitute its own preferred pool or process for a reasonable decision open to the employer.

A single pool of employees with interchangeable skills may permissibly allow employees to state preferences for different available roles. Selection need only occur where preferences exceed the posts available.

An error concerning the pool does not require liability findings to be set aside where independent and unchallenged findings establish an unfair selection process and support a finding that the employer failed to discharge the shifted burden in a race-discrimination complaint.

The Claimant, a Regional Development Manager employed by a housing association, was dismissed for redundancy after a restructuring exercise. The employer placed five managers with allegedly interchangeable skills in a common pool, allowed them to express preferences for Delivery or New Business roles, and selected the Claimant from three candidates for two Delivery roles.

The London (South) Employment Tribunal held that the dismissal was unfair and that it was tainted by race discrimination. It criticised both the selection pool and later aspects of the assessment, including unexplained scoring anomalies and changes to the process.

The employer appealed only against the findings on unfair dismissal and dismissal-related race discrimination. The central issue was whether the Tribunal had unlawfully substituted its view for that of the employer on the redundancy pool and, if so, whether that error displaced the remaining liability findings.

1. Appeal dismissed. The Employment Tribunal erred in holding that no reasonable employer could have used the pool and preference process adopted here. The employer had genuinely considered the pool, could treat the five managers as having interchangeable skills, and could permit them to indicate a preferred role. Where only two employees preferred two New Business posts, it was within the range of reasonable responses to assimilate them without a competitive exercise.

2. The Tribunal was entitled to scrutinise the employer’s reasoning about the pool. However, having done so, it crossed the proper boundary by substituting its view of the appropriate process for the employer’s. In ordinary unfair-dismissal cases, Employment Rights Act 1996 section 98(4) does not require the pool to be confined to employees doing the same or similar work.

3. The error did not disturb the result. Apart from the pool criticism, the Tribunal made detailed and unchallenged findings that the selection process was unfair. These included unexplained departures from model answers, anomalous interview material and scoring, changes to selection criteria, and deficiencies in the appeal. Those findings independently supported the conclusion that the dismissal was unfair.

4. The same independent findings also supported the Tribunal’s conclusion that the burden of proof shifted on the dismissal-related race-discrimination claim and that the employer failed to discharge it. The EAT therefore left both liability findings standing. It expressed no view on remedy, save that the parties could seek an out-of-time review before the Employment Tribunal if the pool ruling affected remedy.

• Employment Appeal Tribunal: Appeal dismissed; although the Employment Tribunal erred on the redundancy-pool issue, its independent findings sustained liability for unfair dismissal and dismissal-related race discrimination: [2013] UKEAT 0042_13_0303.
• London (South) Employment Tribunal: Held that the Claimant had been unfairly dismissed and that his dismissal-related race-discrimination claim was well-founded. The reserved reasons were sent to the parties on 9 October 2013; no citation is stated.