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The Significance of Formative Stage Workforce Involvement in Redundancy Consultation
In the case of Haycocks v ADP RPO, the Employment Appeal Tribunal found that a former employee of the UK recruitment process outsourcing arm of HR software ADP faced unfair dismissal due to a flawed redundancy process.
ADP RPO UK, a UK subsidiary of a US company faced economic challenges in 2020, leading to a redundancy process for the team responsible for recruiting employees for a single company: Goldman Sachs. As COVID-19 impacted demands, the decision was taken to reduce the recruitment workforce.
At the beginning of June, a standard matrix of criteria from the US parent company was used to mark for selection. The 16-person team were scored 1 to 4 on each of 17 entirely subjective criteria by the UK manager. Mr Haycocks came last in the rankings.
On 19 June 2020, ADP RPO UK set a timetable for the redundancy process. The initial consultation meeting was to be held on 30 June 2020. This was to be followed by a consultation period of 14 days. Those leaving will be informed at a meeting on 14 July. The respondent called the claimant to a meeting on 30 June. He was told there was a requirement for redundancies.
The initial ruling by the employment tribunal acknowledged that the scoring was conducted in good faith and was not affected by any conscious bias. Mr Haycocks was not able to demonstrate that he should have received a higher score.
On 14 July 2020, a final meeting took place, during which Mr Haycocks received a letter of dismissal. At that point, Mr Haycocks was unaware of the scores he had attained. He was not provided with the scores of the other 15 employees for comparison.
During the consultation process, a team member working on the Goldman Sachs account voluntarily stepped forward for redundancy. Consequently, Mr Haycocks became the sole individual subject to a compulsory redundancy dismissal.
The original tribunal observed that the scoring occurred in early June 2020, preceding the subsequent decision on 18 June regarding the number of employees to be made redundant.
Mr Haycocks did receive his scores by the time of an appeal meeting with his managers on 10 August. However, he was never provided with the comparative scores of his colleagues.
The original tribunal concluded that the appeal process was conducted “conscientiously”. However, the appeal tribunal identified that the lack of consultation at a stage where substantial changes could be considered by the employer resulted in the absence of potential alternative outcomes.
During the EAT proceedings, Mr Horan, representing Mr Haycocks, contended that there “could be wide speculation as to what differences there might have been if consultation took place at an early stage; it was not only the potential for an impact on the criteria or scoring”.
Mr Horan suggested that a proper consultation could even have seen the redundancies abandoned – citing a case of JCB workers who accepted a pay cut to avoid redundancy. He emphasised there was nothing within the factual findings of the original tribunal to explain why that early consultation was absent. He argued there was, in fact, no meaningful consultation. This is because by the time the claimant, Mr Haycocks was engaged, all the key decisions had been made. “The consultation was not real or transparent in his submission,” stated the EAT judgment in Haycocks v ADP RPO.
The EAT noted that the approach taken to employment law and good industrial relations varied significantly between nations. In this particular case, a tool for selection using entirely subjective criteria came, initially, from the US. It was understandable for ADP RPO UK to use a method used across the wider organisation internationally. But “the use of a system which reflects good industrial relations in another nation may not reflect the usual practice in the UK”.
The Decision of the EAT
The EAT concluded that the absence of consultation throughout the formative stage was sufficient to make the dismissal unfair. The employee’s appeal to his company could only correct any missing aspect of the individual consultation process. For example, the provision of the claimant’s own scores. It could not repair that gap of consultation in the formative stage.
The judgment laid out several guiding principles from previous case law. Among them was that “a fair consultation occurs when proposals are at a formative stage, and where the employee is given adequate information and adequate time to respond along with conscientious consideration being given to that response.” The purpose of consultation, it said, is “to avoid dismissal or reduce the impact of redundancies”.
This case is a good reminder of the significance of formative stage workforce involvement in redundancy consultation. It emphasises the importance of conducting fair and meaningful consultations at the formative stage of employment decisions, providing employees with adequate information and time to respond. The absence of consultation during the formative stage, as highlighted by the EAT, can make dismissals unfair. It can also hamper the efficacy of subsequent corrective measures during the appeal process.
The dangers associated with adopting processes from one nation, in this case, the US, were underscored. The variations in employment law and industrial relations practices between nations need to be carefully considered to ensure alignment with local practices.
Read the full case: Mr Joseph De Bank Haycocks v ADP RPO UK Ltd