The Employment Appeal Tribunal (“EAT”) has held that subjective redundancy selection criteria are not necessarily bad in Mitchells of Lancaster (Brewers) Ltd v Tattersall, noting that criteria that involve a degree of judgment are none the worse for that.
Mr Tattersall was one of five members of Mitchells’ senior management team and an employment tribunal found he was unfairly dismissed after a flawed redundancy selection process. He suffered a 20% deduction to his compensation, as the tribunal held that was the chance he would still have been dismissed even if the selection process had been fair. Mitchells appealed on a number of grounds, and whilst the EAT upheld the finding of unfair dismissal, it disagreed with the tribunal’s criticism of Mitchells’ subjective selection criteria, based on assessing which role in that team could be lost with the least effect on its business. The EAT noted that ‘…just because (subjective) criteria…’ ‘…are matters of judgment, it does not mean that they cannot be assessed in a dispassionate or objective way…’, further noting that ‘…the concept of a criterion only being valid if it can be “scored or assessed” causes us a little concern, as it could be invoked to limit selection procedures to box-ticking exercises…’.
The EAT observed that for a relatively small company in serious financial difficulty, it was hard to see how it was inappropriate for Mitchells to apply the criteria used, holding that those criteria were ‘unexceptionable’. The EAT therefore overturned the tribunal’s 20% Polkey deduction as ‘…significantly too small…’ in the light of its view of the significantly greater likelihood of Mr Tattersall’s selection for redundancy on the criteria used, remitting the amount of the increase of the Polkey deduction to the same Tribunal, indicating that no fresh evidence should be permitted.
Paul Burton, Employment Solicitor, says “This is a helpful judgment for employers who frequently agonise over attempts to come up with objective criteria, when selecting for redundancy, which are meaningful to the situation and not simply statistics.”
For a free initial meeting please call 01202 499255 and Kate or Paul will be happy to discuss any questions you may have.
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