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Duty to consider furlough when making redundancies

Sep 2, 2021

In the recent case of Mhindurwa v Lovingangels Care Limited the Employment Tribunal decided that an employee was unfairly dismissed because the employer failed to consider furloughing the employee under the Coronavirus Job Retention Scheme, as an alternative to redundancy.

Background

Mrs Mhindurwa (the Claimant) was employed by Lovingangels (the Respondent) as a care assistant from March 2018 until July 2020. The Claimant provided live-in care for a vulnerable person from October 2018 until February 2020, when the vulnerable person was admitted to hospital, and later went to live in a care home. At this point, the Claimant was no longer required to provide live in care for this individual.

In May 2020, the Respondent wrote to the Claimant to confirm that they were unable to offer the Claimant any other live-in care work and instead could only offer domiciliary care work which the Claimant was unable to accept due to the location of her home (Birmingham) and the location of the available work (Bracknell). The Respondent stated that they did not have any live-in opportunities due to COVID-19 lockdown restrictions. In July 2020, the Claimant was given notice of dismissal on the grounds of redundancy.

The Claimant’s claim for unfair dismissal was based on the proposition that she should have been placed on furlough, rather than dismissed. The Claimant argued that she “requested to be furloughed in May 2020 in line with what I [she] understood to be Government policy at the time”. This request was denied for what she considered to be inadequate reasons. Further to this, the Claimant argued that the Respondent continued to advertise live-in carer positions on their website, so the Claimant did not believe this to be a genuine redundancy situation.

The Employment Tribunal Decision

The Employment Tribunal accepted the Respondent’s explanation that there was no live-in care work to offer at the time of the redundancy. The Employment Tribunal, therefore, agreed that the Claimant was dismissed due to redundancy.

The Employment Tribunal went on, however, to say that they were of the view that “in July 2020 a reasonable employer would have given consideration to whether the Claimant should be furloughed to avoid being dismissed on the grounds of redundancy”. The Respondent was unable to explain why furlough was not considered suitable. The Respondent’s position was that they had no live-in care work so couldn’t agree to furlough the Claimant, but they do not appear to have considered whether the Claimant should have been furloughed for a period of time to see whether the situation changed, and whether more live-in opportunities arose. The Employment Tribunal decided that the failure to give consideration to the possibility of furlough resulted in the Claimant’s dismissal being unfair”.

Commentary

Furlough came on us all unexpectedly and we are now seeing the case authorities coming around about how furlough was applied (or not) and what this means. This decision shows that employers should have considered (and in some cases still consider) furloughing staff as part of their duty to look at alternatives to redundancy. The Employment Tribunals will continue to consider the steps that businesses take to avoid redundancies and amongst those whether furlough was an alternative. Employers may be asked to explain why furlough was not considered and will need to be ready with a clear explanation as to whatever decision was, or was not, made in this scenario.

For further information or to discuss the issues raised by this update, please contact our Employment Group on 0118 977 4045 or employment@herrington-carmichael.com.

Click here to see our ‘Employment Law Figures 2021’ which includes basic figures, time off work, living wage, minimum wage and tax rates.

 

 

 

 

 

 

 

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

Alistair McArthur

Alistair McArthur

Partner, Head of Employment Law

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> How to Avoid the Problems of Recruitment & Probation
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Employment Management Training Sessions

Darren Smith, a Partner in our Employment team, will be hosting a series of online training sessions looking at essential employment law for managers. Each session will be £79.95 + VAT.

> How to Avoid the Problems of Recruitment & Probation
> Equality, Diversity & Inclusion
> Absence Management
> How to Performance Manage
> Problems with Social Media & actions outside of the workplace
> Disciplinaries and Grievances
> Conducting a Fair Redundancy Process

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