An employee, who had been off sick with work-related stress for several months, was made redundant on her return to work but was not consulted with about the decision. Esther Smith and Martin Brewer advise on where this leaves the employer.

The question:

We provide property management services to a client. We have an employee who has been off work since August 2008 due to depression and work-related stress. Just before she left we had a few complaints from the client that they were not happy with the quality of her work and some things were also said about her not having a good working relationship with them.

During her absence the contract was re-tendered; as a result there were some restructuring done. Now her job is no longer available. She returned to work on Monday and was asked to go home by her manager but was told that she will be paid. The plan of action had been that she would have been written to by HR before returning to work to advise her of a possible redundancy situation, but this was not done. Could you advise me as to where that leaves us now that she is fit to return to work, and bearing in mind that she was off due to work-related stress?

Legal advice:

Martin Brewer, partner, Mills & Reeve

I’m not really sure what the problem is here. If this employee’s job has, as you suggest, disappeared she is in a redundancy situation and you need to take her through a normal redundancy process.

I note however your careful use of language. You say “her job is no longer available”. If by that you mean her job exists but it’s no longer available to her because someone else is doing it and she can’t have it back because the client doesn’t want her, then this is not a redundancy at all – it’s either a performance issue or a matter of conduct.

If it is a matter of conduct you will need to decide if her behaviour warrants dismissal or something less. If it is a performance issue you will also have to consider whether, assuming you don’t dismiss, she needs training to help her improve.

Either way of course, if you don’t dismiss for misconduct or poor performance you will have to see if there is any alternative employment for her, and if there is not then dismissal is the likely result anyway; but you need to be clear that, in this case, you would be dismissing because her conduct/performance made it impossible for her to go back to her original role and there is no alternative employment for her which would, technically, be a dismissal for ‘some other substantial reason’. The key is to consult and seek alternative employment over a reasonable period before deciding to dismiss.

Martin Brewer can be contacted at martin.brewer@mills-reeve.com . For further information, please visit Mills & Reeve.

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Esther Smith, partner, Thomas Eggar

Clearly it is very unfortunate that HR did not contact her as soon as the risk of a redundancy situation arose as, despite her absence from work, this is what should have happened. I am also concerned that the restructure appears to have been carried out in isolation of her, and presumably the other people involved in that service were party to consultation / discussion at that time about the restructuring.

You ought now to be consulting with the employee about the redundancy situation (better late than never) and trying very hard to secure them an alternative position within the organisation.

If you have any employees who have less than a year’s service it may well be worth considering bumping them from their jobs to keep this person employed. The alternative is that if they are dismissed by reason of redundancy they are likely to claim unfair dismissal (on the basis that they were not consulted with during the restructure and therefore denied the opportunity to be considered for any new or different roles that evolved as part of that restructure) and they may also try to claim disability discrimination.

Their first hurdle would be to establish that their condition amounted to a disability but the definition is quite wide and if they have a history of stress / mental health problems they may be in a position where they could mount that argument.

If they get over this hurdle they have a pretty strong argument that they have been less favourably treated by being excluded from the restructure and not consulted with at the appropriate time as of course these things only happened as this employee was off sick. Therefore, if you can secure an alternative position it would certainly mitigate the risk and potential costs of a claim.

Esther Smith is a partner in Thomas Eggar’s Employment Law Unit. For further information, please visit Thomas Eggar.

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