Should I stay or should I go?
27 August 08
If suitable alternative employment is available, an employer must offer it to an employee facing redundancy. An employee who unreasonably refuses such an offer jeopardises the right to a redundancy payment. The question of when refusal is reasonable is tricky. If the employer has a generous contractual redundancy scheme, there may be large sums at stake. If the issue goes to tribunal, the onus is on the employer to show that the employee was unreasonable to refuse the offer of alternative employment.
In the case of Commission for Healthcare Audit and Inspection v Ward, Mrs Ward faced redundancy from a senior post. She was entitled to statutory and contractual redundancy payments. Her employer offered her a new post that it regarded as suitable. She refused the post on a number of grounds: there would be a loss of status as she would be managing a team of 7 rather than 28; her budget would be halved; the job content and experience required would be different; future job prospects would be diminished; and her job security would be reduced.
The tribunal did not accept all these points, although it concluded that the job was only ‘marginally' suitable because its content would be 60% different from that of her previous job. It went on to decide that Mrs Ward's refusal of the offer was reasonable in all the circumstances because of the way in which the redundancy process had been handled by the employer and her disillusionment with it. It also weighed in the balance the fact that looked at objectively, the offer was only marginally suitable. The employer appealed, unsuccessfully, to the EAT who confirmed that there are two parts to the question of whether it is reasonable to refuse an offer. Firstly, the objective question of whether it is a suitable job for someone of the employee's qualifications and experience; secondly, the subjective question of whether it is a reasonable offer, looked at from the employee's point of view in all the circumstances. Matters such as status, pay, management responsibility and actual job content will be critical. However, the way in which the employer handles the process is also important.