We are having to cut back due to lower sales and have offered someone in the sales office an alternative job on the same pay, but quite different working hours in a different department. They have said they cannot do those hours for family reasons, do not like the sound of the job and are insisting not only on a statutory redundancy payment, but payment in lieu of notice as well. I told him that he is entitled to nothing and will get nothing. He is consulting his solicitor.
Peter replies:
If their job no longer exists then their job is clearly redundant. Employees will lose their right to statutory redundancy pay if they unreasonably refuse a suitable alternative job offer. So this begs the question – What makes an alternative role “suitable”?
When considering whether an alternative role is suitable, an employer needs to consider the employee’s skills and experience, and the terms of the alternative job including status, location, duties, pay, hours and responsibility.
You would also need to show that the employee’s refusal was unreasonable. The employee’s specific personal situation, such as whether they have caring responsibilities and travelling distance, also need to be considered, and can mean that a job that may be a suitable alternative for one employee is not for another.
Their specific circumstances might well include:
- the circumstances in which the offer is made, e.g. the time they are given to consider it;
- whether or not the role is temporary; and
- the employee’s personal situation, e.g. the impact it would have on their commute, family responsibilities or career aspirations.
If an employee’s personal circumstances mean that it is reasonable for them to refuse a suitable alternative role, they will still be entitled to a statutory redundancy payment. The issue of whether work is suitable is to be considered separately from whether an employee is acting reasonably in rejecting it. An employee will decide if the work is suitable based upon subjective factors personal to that employee.
The likelihood is that, unless the employee’s reasons for not accepting the offer are very poor indeed; an employer would need to pay redundancy payments to avoid an Employment Tribunal hearing where the rationale will be assessed from the employee’s point of vie. All the case law has favoured employees, so the outcome of a Tribunal claim would probably make it too risky to defend.
Highlighting to an employee that they may lose their redundancy payment if they unreasonably refuse an offer of alternative employment is a useful tactic, but only if you have done everything correctly and they are just being awkward.
Employees are entitled to a trial period of four weeks in the new job, so it might be worth talking to him further i.e. redundancy consultation to see if you can find a compromise on the hours and at least give it a try.
If that does not work then be prepared to pay them a redundancy payment and, unless you are happy for them to work normally during their notice pay, you will also have to give them a payment in lieu of notice, or pay them whilst they are on garden leave.
The manner in which the redundancy process is conducted is important. Whether or not an employee’s refusal to accept suitable alternative employment is reasonable is a subjective judgment, and so the way they are treated is crucial, to whether they accept and how you are perceived. Following a planned redundancy, procedure is not a bureaucratic nightmare; it is just a sensible precaution, legally and in terms of good employee relations.
The guidance provided in this article is just that – guidance. Before taking any action make sure that you know what you are doing, or call us for specific advice.
