Ms C Wheeler v Chilworth Manor Ltd T/a Best Western Chilworth Manor Hotel: 6000549/2024
JUDGMENT
The Claim for unfair dismissal is not well-founded and is dismissed.REASONS
[1]By a Claim Form lodged on 19 February 2024 the Claimant sought compensation for what she contends was her unfair dismissal. I have heard oral evidence from: a) Mr John Billane – Cluster General Manager b) Mr Kevin Skeet – Group Operations Director c) Ms Caroline Wheeler – Claimant.[2]Those witnesses were available for cross examination and there was a bundle of documents that ran to 122 pages and I considered such documents therein as I was taken to, either in the statements or during cross examination. The parties both made short closing submissions.[3]The Claimant was employed between 6 September 2021 to 5 January 2024 as an HR Administrator working part-time – 16 hours per week. Early Conciliation took place between 15 February 2024 and 19 February 2024 and the Claim has been brought within the statutory time limit for unfair dismissal claims.[4]The Claimant issued against two Respondents but it is agreed that the correct Respondent and employer of the Claimant is Chilworth Manor Limited trading as Best Western Chilworth Manor (the Respondent).[5]The Human Resource function for the Respondent is primarily handled by a centralised function at Legacy and I was told and accept that the Respondent was the only hotel to have an HR Administrator on site. The Claimant reported into the Regional Financial Controller via the Financial Accountant (44 and 104). The Claimant’s role was to “support recruitment, payroll, development, retention and welfare of Team members.” The Claimant indicated that she had a role in recruitment and in assisting Heads of Departments (HODs) with their recruitment and in particular getting all the necessary clearances and paperwork together to be forwarded on to the centralised function. The Claimant indicated that retention at the hotel was poor and so there were many comings and goings.[6]Just after the Claimant was appointed a new General Manager of the hotel was appointed – Nigel Easterbrook. There was an incident on 20 December between Easterbrook and the Claimant and the latter raised an informal grievance. The Claimant asserted that the relationship between the two of them “deteriorated”.[7]In November 2022 there was an incident that caused the Claimant to go off with stress and a formal grievance was lodged by her on 13 January 2023. Ms Anthony, the HR Manager at Legacy, investigated the Claimant’s grievance and on 1 March 2023 upheld the grievance “in relation to concerns you have raised regarding your working relationship with (Easterbrook) and how he approaches matters that are brought to his attention.” The actions that followed were: a) Anthony speaking with Easterbrook to raise awareness of how his management style could be perceived; b) Mediation so as to improve relations; c) Providing Easterbrook with guidance on best practice.[8]This would appear to be a positive outcome for the Claimant whose grievance was upheld and steps were taken to try and improve the situation. The evidence suggests that the Respondent, considered the grievance and acted reasonably and proportionately. There is nothing to suggest that the Respondent was irritated or concerned about the Claimant raising a grievance and in fact the opposite appears to be true if the proposed outcome is considered.[9]Mediation did take place and one of the matters raised was that the Claimant considered she should get an increase to her hourly rate. Easterbrook requested that the request be put in writing, and the Claimant did so on 13 April 2023. Her broad point was that many others had had pay rises but she had not and he did not consider that to be fair.[10]On 21 April Easterbrook wrote back saying that apart from essential pay rises on account of compliance with the National Minimum Wage, there would be no further consideration of rises until July 2023. The Claimant on the same morning emailed her discontent to Anthony (55). In July, the Claimant’s pay was increased by 5.5% along with 4-5 other staff. The actual increase was 61 pence per hour and the Claimant considered the pay rise to be “very insulting”.[11]The Claimant raised the matter with Skeet, Billane, and Anthony on 17 July stating that: a) Some staff members had had several pay rises even though they had been employed for a shorter period than the Claimant; b) Easterbrook had not given her a pay rise and had denied her one again as his parting shot back in April.[12]Skeet replied on 18 July that he considered that the pay rise had been appropriate and fair. In August, a new Hotel manager was appointed and the Claimant noted and the Respondent accepted that Ms Willmore began to do more of the HR work herself, to the extent that the Claimant had very little to do. On 1 September, the Claimant raised the issue with Ms Willmore.[13]The Claimant’s grievance over pay was considered by Anthony at a grievance hearing on 7 September. The grievance was rejected by letter on 27 September by Anthony and the Claimant appealed.[14]The appeal was heard on 4 October by Mr Skeet. Not that it holds any relevance to the issues in this case but as a matter of good practice Mr Skeet should not have undertaken that appeal on account of his letter of 18 July. It would have been better if another manager had have heard the appeal who had had no previous dealings and the Respondent may wish to bear that in mind for any future grievances as Paragraph 43 of the ACAS Code on Discipline and Grievances at Work is quite clear that a grievance appeal should “wherever possible be heard by a manager who has not previously been involved in the case”. It should be noted that that was not a specific complaint raised by the Claimant in this case.[15]The grievance was rejected and the letter communicating that sets out its findings with clarity.[16]There is a document in the bundle headed “Redundancy Business Case – Example Format”. The document was drafted by Anthony, who of course is not within the Respondent per se, but part of Legacy. It is a document that is designed to evidence the management thinking at the time the need for redundancies is being considered.[17]Key points in that document are as follows: a) The Respondent hotel was “in financial crisis and is in special measures” with a decline in business over the past two years. b) For 2023 the Hotel Operating Profit was £259,200 behind Budget and “acting on instructions from the hotel owner, we, as the management company have instructed that the hotel makes a minimum cost saving of £100,000 on their annual payroll in an effort to stabilise the business.” c) This was to be partially achieved by plans to achieve savings on a short service dismissal basis and there had been a reduction in the use of Agency workers. Recruitment was being avoided and overtime was being reduced (as best it could) but more savings were required. d) So far as potential redundancies were identified that was the Financial Accountant and the HR Administrator role. It was considered that both roles could be covered by other staff and for the HR Administrator role the work would be done by the new hotel manager. The Claimant confirmed in her evidence that in effect that had been trialled since the Hotel Manager had been recruited as from August she had seem a substantial diminishment of her work. e) Three short service dismissals had yielded £88,000 savings to date. f) There were always “lower-level operational roles” being recruited as they were vital to the business. The Claimant confirmed in her evidence that there was substantial turnover in those roles.[18]On 10 November, the Claimant was warned that her role was at risk and she was written to by Mr Billane on the same day. The Claimant was provided with the numbers detailed above at the first consultation meeting on 20 November and there were further meetings on 24 November and 30 November. At the first meeting the Claimant was offered a role in Food and Beverage or another department at the same salary. The Claimant asked and was assured that it had nothing to do with her previous grievances and complaints over salary. The Claimant was offered a trial in Food and Beverage but, in the end, decided not to take it because it would have a negative effect on her career path and that the Food and Beverage department was, in her view, a toxic one. The Claimant did have previous experience in that front end of the hospitality sector. It is clear that had she accepted then her redundancy could have been avoided.[19]On 5 January 2024, the Claimant’s employment was terminated on a month’s notice and she was paid the requisite statutory redundancy pay. The Claimant appealed suggesting greater costs could have been saved elsewhere and that she had been singled out because of her grievances.[20]Mr Skeet heard the appeal and the Claimant can be seen from the notes to have had her say in full. Mr Skeet emphasised that the need for cost savings had come from the owner. He rejected her appeal. He accepted that costs savings could be made elsewhere and he would continue to look into those but the finances were still bad and the Claimant’s role could be covered by the manager.The Law
[21]The first issue to consider in any unfair dismissal claim is the reason for dismissal. In this case the Respondent has asserted that the reason was redundancy.[22]It is up to the employer to show the reason for dismissal and that it was a potentially fair one — i.e., one that fell within the scope of S.98(1) and (2) and was capable of justifying the dismissal of the employee. A ‘reason for dismissal’ has been described as ‘a set of facts known to the employer, or it may be of beliefs held by him, which cause him to dismiss the employee’ (Abernethy v Mott, Hay, and Anderson 1974 ICR 323).[23]The burden of proof on employers at this stage is not a heavy one. The employer does not have to prove that the reason actually did justify the dismissal because that is a matter for the tribunal to assess when considering the question of reasonableness. As Lord Justice Griffiths put it in Gilham and ors v Kent County Council (No.2) 1985 ICR 233: ‘The hurdle over which the employer has to jump at this stage of an inquiry into an unfair dismissal complaint is designed to deter employers from dismissing employees for some trivial or unworthy reason. If he does so, the dismissal is deemed unfair without the need to look further into its merits. But if on the face of it the reason could justify the dismissal, then it passes as a substantial reason, and the inquiry moves on to [S.98(4)], and the question of reasonableness.’[24]If, as in this case, the dismissal is asserted to be for redundancy the employer must show that what is being asserted is true — i.e., that the employee was in fact redundant as defined by S.139 ERA. Redundancy is defined as follows: ‘For the purposes of this Act an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to(a) the fact that his employer has ceased or intends to cease — (i) to carry on the business for the purposes of which the employee was employed by him, or (ii) to carry on that business in the place where the employee was so employed, or(b) the fact that the requirements of that business — (i) for employees to carry out work of a particular kind, or (ii) for employees to carry out work of a particular kind in the place where the employee was employed by the employer, have ceased or diminished or are expected to cease or diminish.’[25]There has been discussion at this hearing as to the precise state of the Respondent’s financial situation. A common misconception about redundancy is that it only arises where the employer is in financial trouble or struggling to provide work. In Kingwell and ors v Elizabeth Bradley Designs Ltd EAT 0661/02 Mr Justice Burton addressed the confusion thus: ‘It appears to us that there is a fundamental misunderstanding about the question of redundancy. Redundancy does not only arise where there is a poor financial situation at the employer’s… It does not only arise where there is a diminution of work in the hands of an employer… It can occur where there is a successful employer with plenty of work, but who, perfectly sensibly as far as commerce and economics is concerned, decides to reorganise his business because he concludes that he is overstaffed. Thus, even with the same amount of work and the same amount of income, the decision is taken that [a] lesser number of employees are required to perform the same functions. That too is a redundancy situation.,”[26]The Respondent contends that in this case the redundancy situation that pertains is a diminishing need for employees to do the available work. It is the requirement for employees to do work of a particular kind which is significant. The fact that the work is constant, or even increasing, is irrelevant. If fewer employees are needed to do work of a particular kind, there is a redundancy situation.[27]The test for redundancy was set out in case law as follows. In Safeway Stores plc v Burrell 1997 ICR 523 the EAT set out a simple three-stage test. A tribunal must decide:(i) Was the employee dismissed?(ii) If so, had the requirements of the employer’s business for employees to carry out work of a particular kind ceased or diminished, or were they expected to cease or diminish?(iii) If so, was the dismissal of the employee caused wholly or mainly by the cessation or diminution?[28]The test set out in the Burrell case was subsequently endorsed by the House of Lords in Murray and anor v Foyle Meats Ltd 1999 ICR 827.[29]Where the overall amount of work that needs to be done has not diminished, a redundancy situation may nevertheless arise where fewer employees are needed to do the work. This situation will typically arise where the employer has introduced technological changes to working practices or where the employer reorganises the work so that it can be done by fewer employees. The Respondent asserts that the latter took place in this case.Conclusions
[30]Normally in an unfair dismissal for redundancy the focal point is on the process. That is not the case here. The Claimant’s case lies with challenging the second and third limb of the Safeway case. The Claimant asserts that the true reason for the dismissal was not redundancy but because she had raised grievances. She states that the whole process was a sham although,, if it was not a sham she accepts that the various requirements such as warning, consultation, fair selection and redeployment have all been complied with but only “so the ”I’s could be dotted and T’s could be crossed”.[31]It is understandable that the Claimant is upset by her redundancy such situations by their very nature are unpleasant and unsettling. I am satisfied that there was an edict from the owner for staff costs to be cut by £100,000. That is a prerogative of the owner and one which was then implemented by Legacy and ultimately the hotel management. It was not those close to the Claimant however who instituted the process, it was somebody who did not know she existed or what her history was.[32]I am satisfied that a number of individuals including the Claimant were dismissed in order to achieve the owner’s stated need. I have seen the correspondence and note that at least four other staff were dismissed at around the same time. Again, that is clear evidence of the truth of the financial background in this case and further is indicative that there was no personal element to the overarching programme of cuts.[33]It is still possible of course for personal hostility arising from the Claimant’s previous complaints/grievances to have influenced the Claimant’s selection. Whilst I understand that the Claimant is convinced of this I do not consider that it has been made out evidentially. Even on the Claimant’s own evidence her role was being covered before her redundancy by the hotel manager. The Claimant may have been able to do it more effectively but ultimately there was a redundancy situation because the requirements of the employer’s business for employees to carry out work of a particular kind had ceased. The Hotel Manager could do both her work and that of the Claimant and had done so for 2-3 months. It seems to me that the Claimant could have been made redundant some months before she actually was if maximum savings were to be obtained. Even if there was no financial imperative to save money the Claimant would still have been redundant and I remind the parties of Burton J’s words I cited earlier: “(A redundancy) can occur where there is a successful employer with plenty of work, but who, perfectly sensibly as far as commerce and economics is concerned, decides to reorganise his business because he concludes that he is overstaffed. Thus, even with the same amount of work and the same amount of income, the decision is taken that [a] lesser number of employees are required to perform the same functions. That too is a redundancy situation.”[34]I am entirely satisfied on all the evidence that the Claimant’s role was redundant. She was adequately warned and I find adequately consulted. She was selected because her role was the redundant one and she was offered an alternative in Food and Beverage.[35]It seems to me that if the Respondent had have had a hostile animus towards the Claimant and wanted her out, it would not have offered her a job in Food and Beverage which at one point she was considering. If the aim were to exit her from the organisation then making her redundant was a very risky option as there was a real chance she would not be leaving but move into an alternative role on an enhanced rate to other Food and Beverage Staff. I consider that the offer for alternative work was a reasonable one and the Claimant elected to be made redundant as opposed to continuing her service with the Respondent. That is her choice and she decided that dismissal and seeking to pursue her HR career was a better option for her than continued employment at the Respondent. Her choice must be respected but it does not support her claim of unfair dismissal.[36]I am satisfied that the reason for the dismissal was redundancy, that there was a redundancy situation relation to the Claimant’s role and the dismissal was wholly attribuatable to the cessation of the Claimant’s role. The process that led to the dismissal was a fair one. This was not an unfair dismissal and the Claim is dismissed.