Your employer is making you redundant but has offered you another job – must you accept it?

Your job is at risk of redundancy, and your employer has offered you redeployment to another job in the same company. Are you obliged to accept the redeployment?

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This article covers

• Redundancy
• Redeployment
• Statutory trials periods

Redundancy

Redundancy is a ‘fair’ means of dismissal by your employer, so long as the procedures they follow and the circumstances are correct. A redundancy situation happens when there’s no more, or not enough, work for you and your colleagues (e.g. your employer closes or relocates the business, or now needs fewer workers). Your employer needs to take the following steps to ensure the redundancy is ‘fair’:

• • Employees need to be informed of proposed redundancies by undertaking Consultation with the ‘affected employees’ (or their representatives) with a view to ‘reaching an agreement,’ which means they should consider alternative ideas to redundancy and explain their decisions to you
  • Your employer must select those who are at risk of redundancy in a fair way

• They must consider offering you any alternative work that’s available and suitable and they must tell you of any vacancies at your company. If a suitable job is available, you won’t be entitled to a redundancy payment (see below)
• They must pay you your Statutory Redundancy Pay entitlement (if you have two years continuous service) if there’s no suitable work available for you at that time.

Check out our article on Redundancy and Statutory Redundancy Pay

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Redeployment

Employers need to consider the following factors when deciding if an alternative role will be ‘suitable’ to replace your redundant job:

• Will you have the right skills and experience for the new role?
• Are the terms of the alternative job similar – e.g. status, place of work, job duties, pay, hours of work, responsibility.

If it’s reasonable for you to refuse a ‘suitable’ alternative role, you’ll receive a statutory redundancy payment. You won’t be due a redundancy payment if you unreasonably refuse a suitable alternative job offer.

Deciding if it’s reasonable for you to turn down an offer of alternative employment will depend on your specific circumstances, including:

• The amount of time you’re given to consider the new job
• Whether the role is temporary or not and the role’s status
• The impact it’ll have on your personal situation (e.g. if it’s in a different location, the effect on your family life or health)

Your employer can’t force you to accept an offer of alternative employment. However, if you refuse such an offer unreasonably, you’ll forfeit your right to statutory redundancy payment as long as:

• The offer of the alternative employment was made before the end of the previous employment and you were given details of the new job
• The new job starts on the termination of the old job or within four weeks of it
• The job that’s offered has the same terms as the original contract, or if they differ, the job is still seen as suitable alternative employment.

The onus is on the employer to show both your suitability for the job and that you’ve unreasonably refused the job.  If your employer believes the alternative job is suitable, but you disagree, you may be able to claim for statutory redundancy pay and unfair dismissal at an Employment Tribunal after you’ve followed your company’s internal grievance process.

If an employer has alternative work available that’s suitable but doesn’t offer this to the redundancy employee, the redundancy dismissal of the employee may be an unfair dismissal.

Dunne v Colin & Avril Ltd 2017

In Dunne v Colin & Avril Ltd 2017, Ms Dunne had leukaemia and worked 24 hours per week over three days as a bookkeeper.  Her employment transferred to a new business (same owner) and, initially, she was offered 16 hours per week, which she declined for financial reasons.  She was then offered 24 hours per week involving 16 hours per week as bookkeeper, plus eight hours of other work that included some work in the company warehouse.

Ms Dunne declined, reasoning it was inconsistent with her skills and experience and wouldn’t be cost effective (as she was paid more as a bookkeeper); she was then dismissed. At the tribunal, it became clear for the first time that she couldn’t work in the warehouse because of the cold environment.

The Tribunal found her dismissal for redundancy was fair as the second offer was suitable (predominantly office based and the same pay) and her refusal of it wasn’t reasonable.  The case went to EAT who weren’t happy with the ET’s approach, and the case has been sent back to Tribunal. The EAT said that the Tribunal should have asked if the employer had demonstrated that her refusal was unreasonable.

In Aramark (UK) Ltd v Fernandes, Mr Fernandes was due to be made redundant. He argued that, before being made redundant, he should have been added to Aramark’s list of ‘additional workers’, which was a pool of workers to be called upon to work as and when work was available. Without doing this, Mr Ferenandes said he had been unfairly dismissed.

These ‘additional workers’ were not employed by Aramark and were not guaranteed work. The original Employment Tribunal agreed with Mr Fernandes and said that, by not consulting with him about the pool of additional workers, his dismissal was unfair. However, the Employment Appeal Tribunal in 2020 disagreed and said that if Mr Fernandes had been added to the list of additional workers, this would not have avoided his dismissal by reason of redundancy, as he would not have been provided with work that guaranteed alternative employment.

For details about redundancy during maternity leave, see details here.

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Statutory trial periods

If your employer offers you a new job that’s a reasonable alternative to your old job, but where there are some differences to the old position and its terms and conditions, you’re entitled to an automatic four-week statutory trial period in the new job.

• If, during the four week trial period (or at the end of the four weeks), you don’t want to stay in the new job and either you or your employer terminates the new contract or gives notice to terminate the contract – because it’s not considered a suitable alternative due to the differences between the old and new contracts – you’ll be classed as being dismissed by redundancy and still qualify for a redundancy payment
• If at the end of the four weeks you need more time for re-training, the period may be extended (as long as this was agreed at the outset). This only applies for re-training. If it is for other reasons, this may take the trial period outside of the statutory regime, meaning the right to a redundancy payment would be lost
• If the work is suitable and you’re seen to be ‘unreasonably’ terminating the contract (resigning or giving notice to resign), you’ll lose the right to a redundancy payment. However, the employer needs to show that the alternative employment that was offered was suitable and the employee’s refusal to do the job was unreasonable. Tribunals set this bar quite high for employers to prove, as they are not keen on depriving an employee of their redundancy payment
• If you stay in the new job after these four weeks, you’ll be considered to have accepted the new job (assuming you’ve not said differently) and will forfeit your redundancy payment
• It is possible to start a new four week trial period in another alternative job if the first new job/trial period is unsuitable (and everyone agrees)
• The four week trial period should generally start immediately after your previous job has ended, which means that you must have been given notice of redundancy dismissal from your previous job for the trial period to start; and you must have accepted an offer of the new alternative employment before the original job ended
• If the new job/four week trial period doesn’t start immediately after the previous job ends, it must start within four calendar weeks of the old contract
• If an employer refuses to give a trial period for a job that should attract one this can make a redundancy dismissal unfair.

In East London NHS Foundation Trust v O’Connor in November 2019, the EAT found that telling an employee that his job was being “deleted” did not in itself amount to a redundancy dismissal and therefore a statutory trial period was not automatically triggered.

Mr O’connor was told that, after a restructuring exercise in March 2017, that his role was at risk of redundancy and he was later told his role would be ‘deleted’ from 3rd July 2017.

Formal notice of dismissal was not given and Mr O’Connor was later offered a trial period for an alternative role, starting on 3rd July. This was extended to 9th August to accommodate Mr O’Connor’s pre-booked holiday, although the Trust was unaware that it could not legally extend a statutory trial period.

At the end of the trial period, the Trust offered Mr O’Connor the role on a permanent basis. However, there was a dispute as to whether the role was in fact a suitable alternative role (he argued it wasn’t), which would mean Mr O’Connor would not be entitled to a redundancy payment. Mr O’Connor went off sick and raised a grievance saying the new role was not a suitable alternative. The Trust agreed to extend the trial period while the grievance was ongoing, but the grievance was rejected in November 2017.

The Trust offered him the new role again, which he declined, and they terminated his employment in December 2017, declining to make a redundancy payment, saying the statutory trial period had ended on 9th August and that he had unreasonably refused suitable alternative employment. Mr O’Connor bought a claim for statutory redundancy pay (he had been paid for his notice period). The Trust appealed the original ET decision but the EAT upheld the ET’s findings that formal notice of dismissal was not given on or before 3rd July and that the trial period for the new job was not a statutory trial period, and that Mr O’Connor had been dismissed in December 2017.

This would have meant that his entitlement to a redundancy payment was not automatically extinguished by the trial period. The case has now gone back to Tribunal to determine if it was a redundancy dismissal and so if a redundancy payment was due.

If you are an employer and need ongoing professional help with any staff/freelance issues then talk to us at The HR Kiosk – a Human Resources Consultancy for small businesses – you can retain us for as much time as you need.

Please note that the advice given on this website and by our Advisors is guidance only and cannot be taken as an authoritative or current interpretation of the law. It can also not be seen as specific advice for individual cases. Please also note that there are differences in legislation in Northern Ireland.