20 September 2013:

If someone is made redundant from their current position, the employer is under an obligation to consider them for suitable alternative positions that are available. If the employer is able to offer the person a suitable alternative role, they are not therefore redundant. But what if the employee turns around and says the new role is not suitable?

In the Court of Appeal case of Devon Primary Care Trust v Readman this week, Ms Readman was made redundant, but then offered two alternative roles involving a loss of pay and status, but one which was reasonably similar in terms of seniority. When is the alternative employment offeredsuitable? The Tribunal concluded she unreasonably turned down the similar role and took into account the fact that she had a job offer in Canada.

The Court of Appeal held that one should consider “whether this particular employee in this particular situation acted reasonably in refusing the offer of employment”. The fact that Ms Redman had a job offer in Vancouver was therefore not a material consideration. The CA held that the Tribunal should have addressed directly whether it was unreasonable for the respondent to decline to work in the hospital where it was offered.

Some employees will be keen to take the big fat enhanced redundancy package and move on especially if employee has another job lined up. This can be a real headache when the employer thinks it has a suitable alternative position and doesn’t want the employee to leave.

On the other hand, it can be difficult for an employee to leave anyway, and then fight for a redundancy package in the Tribunal. It would be wise for employers to make any enhanced redundancy packages purely discretionary, and subject to a legally binding Settlement Agreement.