Redundancy dismissal and continuing furlough

Handley v Tatenhill Aviation Ltd

The dismissal of an employee for redundancy, despite the existence of the furlough scheme, did not make his dismissal unfair.

Background

Mr Handley worked as a flying instructor for a small business employing 12 staff. Just after the start of the first national lockdown, his employer told him that the flying school was closing due to the pandemic. He was placed on furlough for a period of three weeks ‘or until you can return to work as normal’. In April 2020, the flying school instituted redundancies as its income had dried up. Mr Handley was selected for redundancy and dismissed in August 2020. He brought a tribunal claim for unfair dismissal, arguing that his furlough agreement prevented his redundancy.

Tribunal decision

This part of his claim was dismissed.

The tribunal accepted that his employer needed to cut costs irrespective of the furlough scheme and that it wanted to use the scheme to pay some of the costs of redundancy. Although another employer may have chosen to leave Mr Handley on furlough for longer, it was not unfair of the employer here not to do so. As the judge put it:

‘Whilst another employer may have taken a different approach and chosen to leave the claimant on furlough for longer, it cannot be said that it was unfair of the respondent not to do so. It is for an employer, not the employment tribunal, to decide how to structure its business and whether to make redundancies. I accept the respondent’s evidence that it needed to cut costs irrespective of the furlough scheme, and that it wanted to use the furlough scheme to pay some of the costs of making the redundancy. The nation was in unprecedented uncertainty at the relevant time, and it is not for me to step into the shoes of the employer and substitute my view for that taken by the employer at the time. The decision to dismiss the claimant nothwithstanding the existence of the furlough scheme does not, in my view, render the dismissal unfair’.

Mr Handley’s unfair dismissal claim did succeed on procedural grounds but as there was a 100% chance that he would have been dismissed had a fair procedure been followed, he received no compensatory award.

Link to judgment: https://www.bailii.org/uk/cases/UKET/2021/2603087_2020.html

Comment

Again, this is a first instance decision by a tribunal which is not binding and can be directly contrasted with the Mhindurwa tribunal decision which held that failure to place a carer on furlough when they had no work for and did not know if they would do because of the pandemic, did render the dismissal unfair. The key will be whether the employer considered furlough and, having balanced everything up, has concluded that even taking away the uncertainty of the pandemic, they still needed to cut costs.