Kellogg Brown & Root (UK) Ltd v Fitton; Kellogg Brown & Root (UK) Ltd v Ewer

Where an employer closes a workplace but invokes a contractual mobility clause, the existence of a statutory redundancy situation does not itself determine the reason for dismissal. The tribunal must identify the facts or beliefs operating in the employer’s mind. A dismissal caused by refusal to comply with a relocation instruction may therefore be for conduct, notwithstanding the workplace closure.

That conclusion does not decide fairness. In assessing a dismissal for refusal to relocate, the tribunal may consider whether the instruction was contractually legitimate, whether it was reasonable, and whether the employee’s refusal was reasonable. A contractual entitlement to dismiss does not by itself make dismissal fair under Employment Rights Act 1996, section 98(4).

The employer closed its Greenford workplace and instructed the two claimants to work at Leatherhead under a contractual mobility clause. Both refused because of the substantially increased journeys. They were dismissed following disciplinary proceedings.

In separate decisions, the Watford Employment Tribunal held that the dismissals were by reason of redundancy, awarded statutory redundancy payments, and found the dismissals unfair. The employer appealed both decisions.

The common issues were the true reason for dismissal where a workplace closure coincided with reliance on a mobility clause, entitlement to statutory redundancy payments, and the fairness of dismissal for refusal to relocate.

1. Appeal allowed in part. The appeal against the awards of statutory redundancy payments was allowed. The appeal against the findings of unfair dismissal was dismissed.

2. The Employment Tribunal erred by allowing its finding that there was a redundancy situation within section 139 of the Employment Rights Act 1996 to determine the reason for dismissal. Applying Abernethy, the required inquiry was into the facts or beliefs which caused the employer to dismiss.

3. On the Tribunal’s own findings, the employer believed it could require relocation under the mobility clause and dismissed because each claimant refused that instruction. The closure of the former workplace was the background to the dismissals, but not their operative reason. Consistently with Curling and Home Office v Evans, an employer may invoke a mobility obligation rather than a redundancy procedure where it does so consistently and in time. No statutory redundancy payment was therefore due.

4. The Tribunal had, however, made adequate alternative findings on unfair dismissal. It considered whether the relocation instruction was contractually legitimate, whether it was reasonable, and whether each refusal was reasonable. It permissibly found that the broadly drafted clause had not been validly or reasonably invoked, that the substantial additional commuting burden made the instruction unreasonable, and that each claimant’s refusal was reasonable in his particular circumstances.

5. The Tribunal’s reasoning had to be read as a whole. It was not vitiated by substitution, perversity, or inadequate reasons. Although the employer had offered temporary financial and working-time measures, the Tribunal was entitled to conclude that they did not alter the fairness assessment. The unfair-dismissal findings accordingly stood.

• Employment Appeal Tribunal: Allowed the employer’s appeal against statutory redundancy payments, but dismissed its appeal against the unfair-dismissal findings: [2016] UKEAT 0205_16_2111.
• Watford Employment Tribunal: In separate judgments sent on 6 April 2016, held that each claimant had been dismissed by reason of redundancy, was entitled to a statutory redundancy payment, and had been unfairly dismissed.