Campbell v Tesco Personal Finance plc

The Employment Appeal Tribunal allowed the appellant's appeal on the unfair dismissal issue and remitted that part of the claim for re-hearing. The central legal principle was the statutory test for redundancy in section 139 of the Employment Rights Act 1996: the tribunal must decide whether the employer's requirements for employees to carry out work of a particular kind have ceased or diminished. The tribunal below had relied on the reorganisation from three teams to two and the deletion of the appellant's former post, but failed to make any factual finding that the employer's requirement for risk-management employees had ceased or diminished. The EAT held that the tribunal had therefore not correctly applied section 139 and set aside its decision dismissing the unfair dismissal claim, remitting that issue to a differently constituted tribunal for a re-hearing.

Background and parties:

• The appellant was employed by the respondent as a Risk Manager from March 2010 until August 2019.
• In 2018 the respondent restructured its risk function, reducing three risk teams to two and creating a Centralised Controls Testing Team with two posts: Lead Risk Manager and Risk Manager.

Procedural posture:

• The Employment Tribunal in Glasgow dismissed the appellant's claims (unfair dismissal under section 98 Employment Rights Act 1996; direct discrimination under section 13 Equality Act 2010; and indirect discrimination under section 19 Equality Act 2010). The appellant appealed to the EAT on multiple grounds, of which two relating to unfair dismissal were permitted to proceed.
• The appeal challenged (i) whether there was a genuine redundancy situation and (ii) the fairness of the selection process.

Issues framed:

1. Whether the Employment Tribunal correctly applied the statutory redundancy test in section 139 ERA when deciding that a redundancy situation existed.
2. Whether the selection process was procedurally fair (selection scoring matrix and departure from it).

Facts and tribunal findings:

• The respondent merged the appellant's Commercial Risk team with other teams. The tribunal found the appellant and a colleague were at risk of redundancy and that their roles would be replaced by a Lead Risk Manager post and a Risk Manager post.
• A scoring exercise resulted in the appellant being unsuccessful and her employment ended on 2 August 2019.
• The tribunal below accepted that teams reduced from three to two and described deletion of the "old" structure, but did not expressly apply the words of section 139 ERA to explain how the employer's requirements for employees to carry out risk-management work had ceased or diminished.

Court's reasoning:

• The EAT emphasised that the correct question under section 139 ERA is whether the employer's requirements for employees to carry out work of a particular kind have ceased or diminished.
• The tribunal below had focused on the reduction in the number of teams and the deletion of the appellant's prior post but made no factual finding that the employer's requirement for risk-management employees had diminished.
• The creation of a Lead Risk Manager role with a leadership function was not, without more, sufficient to establish that the requirement for employees to perform risk-management work had diminished.
• Because the tribunal did not correctly apply the statutory test, its decision on the unfair dismissal claim could not stand.

Disposition: The EAT allowed the appeal on the first ground, set aside the tribunal's decision dismissing the unfair dismissal claim and remitted that aspect for re-hearing by a differently constituted tribunal. The second ground, relating to selection process irregularity, would not have succeeded on the evidence and was not determinative.

Appeal allowed. The Employment Tribunal had not correctly applied section 139 of the Employment Rights Act 1996 because it made no finding that the employer's requirement for employees to carry out risk-management work had ceased or diminished. The tribunal's focus on a reduction in the number of teams and on deletion of the appellant's old post was insufficient. The dismissal of the unfair dismissal claim was set aside and that part of the claim remitted for re-hearing by a differently constituted tribunal.

Appeal from an Employment Tribunal sitting in Glasgow which gave judgment on 29 January 2021 dismissing the claimant's claims. The appeal was heard by the Employment Appeal Tribunal, neutral citation [2023] EAT 68, and the EAT allowed the appeal in part and remitted the unfair dismissal issue for re-hearing.