Hendy Group Ltd v Daniel Kennedy

In a redundancy dismissal, fairness under section 98(4) requires the employer to consider whether suitable alternative employment can avoid dismissal. The question remains whether the employer acted within the range of reasonable responses, having regard to its size and administrative resources.

A large employer with available vacancies may act unreasonably if it does no more than direct an at-risk employee to publicly advertised jobs, gives no effective assistance, and fails to ensure that relevant managers know of the redundancy risk. A tribunal may conclude that the absence of a genuine consideration of alternatives caused the employee not to obtain a role. It may therefore make no Polkey reduction where, on the facts, a fair process would probably have secured alternative employment.

The claimant, a long-serving motor-trade trainer, accepted that a genuine redundancy situation existed and that his selection was fair. He contended that his dismissal was unfair because Hendy Group Ltd had not properly considered alternative employment within its group.

The Employment Tribunal found that the employer provided no effective support in identifying or pursuing vacancies. It did not inform relevant managers that the claimant was at risk, and an HR email effectively excluded him from sales roles. The Tribunal held the dismissal unfair and awarded £19,566.73 without a Polkey reduction.

The employer appealed, alleging an incorrect test, impermissible substitution of the Tribunal’s view, and an inadequate Polkey assessment. The central issue was whether the Tribunal had lawfully found that the failure to consider alternative employment rendered the redundancy dismissal unfair.

1. Appeal dismissed. The Employment Tribunal had not erred in holding the redundancy dismissal unfair.
2. Under Employment Rights Act 1996, section 98(4), the controlling question was whether the employer reasonably treated redundancy as sufficient reason to dismiss this employee. The Tribunal must not substitute its own view, but must assess whether the decision fell within the range of reasonable responses.
3. The Tribunal’s legal self-direction was concise and did not expressly refer to the range of reasonable responses. Read fairly and as a whole, however, it applied the correct section 98(4) test. Its finding was that the employer had done nothing meaningful to consider alternative employment. The claimant was merely told to apply for vacancies, HR used an inaccessible internal email address, and managers were not told that he was at risk of redundancy.
4. It was open to the Tribunal to conclude that this approach was one no reasonable employer would have adopted. The employer was a large organisation with available vacancies for which the claimant was, at least on paper, suitable to be considered. A reasonable consideration could have included identifying roles, discussing the claimant’s interests and encouraging discussion of different roles, including demotion.
5. The Tribunal’s findings about the claimant’s experience, attitude and applications were not an impermissible substitution of its view for the employer’s. They were relevant to remedy and to the likelihood that, if alternative employment had been fairly considered, he would have obtained it. The final HR email also entitled the Tribunal to find that he had effectively been blocked from sales roles.
6. The Tribunal had sufficiently carried out the required counterfactual assessment. Reading its reasons as a whole, it found that a fair consideration of alternative employment would have resulted in the claimant securing alternative work. Its refusal to make a Polkey reduction was therefore sustainable.

• Employment Appeal Tribunal: Appeal dismissed; the Tribunal’s finding of unfair dismissal and its compensatory award were upheld.
• Employment Tribunal, Southampton: Following a hearing on 4 November 2021, Employment Judge Housego held that the claimant had been unfairly dismissed for redundancy. Judgment and reasons were sent on 6 December 2021. Compensation of £19,566.73 was awarded, with no Polkey reduction.