Do Employers really know the Meaning of Redundancy?

redundancy

If not, it is crucial that they do for the purposes of establishing a fair dismissal. The question that was posed in the case of EXOL Lubricants Ltd v Birch and another UKEAT/0219/14, was: When employees lost the benefit of free parking near their homes, was this a place of work redundancy? The answer delivered by the Employment Appeal Tribunal (“EAT”) was a resounding no.

The case concerned two delivery drives who, for several years, had been entitled to park their HGVs overnight at a secure facility near their homes in Stockport; the place of work stipulated in their employment contracts was Wednesbury where the depot for loading was located. As part of a costs saving exercise, the employer withdrew the arrangement entitling the drivers to park near their homes and subsequently dismissed the drivers on the grounds of redundancy owing to the fact that the company had ceased carrying on business in Stockport.

The dismissal by the employer was found to be unfair by the EAT on the basis that there was no redundancy situation; the employer still required delivery drivers and the drivers’ place of work both contractually and, in fact, had always been Wednesbury. This was not a workplace closure.

This case serves as a useful reminder of the proper test in determining where the employee is employed for redundancy purposes. The employer must have regard to the contractual provision defining “place of work” and to the factual circumstances including the connection that the employee may have with a depot or head office. It would seem that, had the employer sought to justify the dismissals on the grounds of “Some other Substantial Reason,” owing to business based reasons, as opposed to redundancy, the result may well have been different.

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