A tribunal has found that a failure to consider furlough before making an employee redundant amounted to unfair dismissal

In Mhindurwa v Lovingangels Care Limited, the Claimant brought an unfair dismissal claim on the basis that she had asked to be furloughed, and was instead made redundant. The Claimant was a live-in care worker, and the person to whom she provided the care was hospitalised in February 2020, and then subsequently left hospital to live in a care home. The Claimant’s work had therefore ceased.

As a result of the COVID-19 pandemic, live-in care work had reduced significantly. The Respondent could only offer the Claimant domiciliary care work which was not sufficiently close to the Claimant’s home. An employer is entitled to make an employee redundant if the requirements of the business for employees to carry out work of a particular kind have diminished or ceased. In this case the Claimant’s work had ceased, and no other suitable work could be found, therefore the Respondent chose to make the Claimant redundant.

In ordinary circumstances, it is likely that this would have been a fair dismissal, because the criteria for redundancy had been satisfied. However, in March 2020 the Coronavirus Job Retention Scheme (which allowed for employers to furlough their employees whilst maintaining 80% of the employee’s pay) was introduced. The purpose of this scheme was to keep people in employment who might otherwise have lost their jobs as a result of the COVID-19 pandemic.

The Claimant asked to be furloughed in May 2020, on the basis that, at this point, no other suitable work had been found for her since February 2020. The Claimant’s request was denied by the Respondent who subsequently made her redundant in July 2020. The Tribunal was satisfied that the Claimant had been dismissed because of redundancy.

However, the Respondent stated that it opted not to furlough the Claimant because it did not have any suitable work for her, failing to appreciate that the situation might change and that the circumstances at the time were precisely the reason why the furlough scheme had been introduced. The Respondent did not have the foresight to consider that the situation might have changed and more work might become available for the Claimant.

The Tribunal stated that at the time the Claimant was dismissed a reasonable employer should have considered furlough, and that the Respondent could not explain why it had not done so.

After the Claimant had been made redundant, she appealed the decision and was invited to an appeal hearing. The Tribunal found that this hearing was a ‘rubber-stamp exercise’, and that the person responsible for conducting it had not carried out any investigation of his own, but had relied upon what he was told by other employees responsible for making the initial decision.

An employer should carry out a fair and unbiased appeal process, with a different person conducting the appeal to the person who made the original decision wherever possible. The Tribunal stated that its finding of unfair dismissal was based upon both the failure to consider furlough instead of redundancy, and the fact that the appeal had not been conducted properly.

It is worth noting that this is a first instance decision, and therefore is not legally binding on other employment tribunals. The outcome may also yet be appealed. It is, however, interesting to note the Tribunal’s stance in placing a positive obligation on the Respondent to have considered furlough instead of redundancy and this case may be persuasive in other cases with similar circumstances.

It is also relevant to note that this case does not state that the employer must place the employee on furlough instead of dismissing due to redundancy, but rather the employer should consider furlough as part of a fair redundancy process and its obligation to consider alternatives to compulsory redundancies. Employers should be prepared to explain any decision not to furlough in these circumstances and a sensible employer would be reminded to make a record of such decision.

The impact of this case is unlikely to have much practical relevance as we draw closer to the planned closure of the job retention scheme on 30 September 2021.

If you would like to discuss the above in more detail or if you require any employment law advice, please do not hesitate to contact a member of the Employment Law Team.