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Unfair Selection For Redundancy

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[Thanks to Ed McFarlane of Deminos HR for preparing this case summary]

Are subjective redundancy selection criteria bad? No, says the EAT (the Master of the Rolls presiding) in Mitchells of Lancaster (Brewers) Ltd v Tattersall, noting that criteria that involve a degree of judgment are none the worse for that.

The Claimant was one of five members of the Respondent's senior management team, unfairly dismissed after a flawed redundancy selection process, but with a 20% Polkey deduction. The Respondent appealed on a number of grounds, and whilst the EAT upheld the finding of Unfair Dismissal, it disagreed with the Employment Tribunal's criticism of the Respondent's subjective selection criteria, based on assessing which role in that team could be lost with the least effect on its business. In paragraph 21 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 the Respondent to apply the criteria used, holding that those criteria were 'unexceptionable'.

The EAT therefore overturned the ET's 20% Polkey deduction as '...significantly too small...' in the light of its view of the significantly greater likelihood of the Claimant'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.