Employment Law Update – January 2017
In Kellogg Brown & Root (UK) Ltd v (1) Fitton and (2) Ewer, the EAT considered whether employees who were dismissed when their employer had exercised a mobility clause to move them to another office, had in fact been dismissed by reason of redundancy, as decided by the employment tribunal.
Background
Mr Fitton and Mr Ewer worked at Kellogg’s office in Greenford. They both had a mobility clause in their contracts of employment which provided that Kellogg might require them to work at different locations and that this term must be complied with “unless exceptional circumstances prevail”.
In April 2015, Kellogg gave notice to their employees that the Greenford office would be closing at the end of June 2015 and that all employees would be transferring to the Leatherhead office.
Some employees chose to leave Kellogg’s claiming there were “exceptional circumstances” as to why they could not transfer to Leatherhead. Most of the reasons involved childcare and caring responsibilities and Kellogg paid them a redundancy payment.
Mr Fitton’s case
Mr Fitton had worked for Kellogg for 11 years and the Greenford office was walking distance from his home. On 21st April 2015, after the announcement that he would be expected to travel to Leatherhead, he told his line manager that he objected to the two hour commute each way to and from Leatherhead which was in stark contrast to his current 20 minute trip.
Following legal advice, Mr Fitton informed his manager that by closing the Greenford office, his role was in fact redundant and so he was entitled to a redundancy payment. Kellogg disputed this and stated that the mobility clause was enforceable and that the transfer of offices meant that there was no redundancy situation. They went a step further as to say that refusal to relocate could lead to dismissal for failing to comply with employment terms.
On 18th June 2015, when Mr Fitton was told to transfer to Leatherhead, he refused and was therefore invited to a disciplinary hearing for unacceptable conduct. Mr Fitton was dismissed and his internal appeal was unsuccessful.
Mr Ewer’s case
Mr Ewer had worked for Kellogg for 25 years. On 25th April 2015, following the announcement, he met with his line manager and objected to the additional travel as he lived in St Albans. He pleaded exceptional circumstances as he was approaching retirement age (he was 64) and that it would be a daily stress to turn an 18 mile each way commute into a 47 mile commute each way.
Kellogg disagreed that Mr Ewer’s circumstances were exceptional and when he did not show at the Leatherhead office, he was invited to a disciplinary hearing and subsequently dismissed. His internal appeal was, like Mr Fitton’s, unsuccessful.
Employment Tribunal hearings
Although both claims were brought separately and heard at separate hearings with separate decisions, they were heard by the same employment judge and the outcome was the same. The employment judge held in both cases that the instruction to work in Leatherhead was unreasonable given the increased travelling times – the mobility clause was too wide to be relied on. It was held that the reason for both dismissals was in fact redundancy. He also held that engaging a disciplinary process was procedurally flawed given that the reason for the dismissals was redundancy and so the dismissals were also held to be unfair.
Employment Appeal Tribunal
Kellogg appealed against both decisions.
In relation to the Employment Tribunal’s finding that the dismissals were by reason of redundancy, the EAT found that in each case Kellogg had believed they could avoid redundancies by relying on the mobility clause and so the instruction to move employees from Greenford to Leatherhead was reasonable. Therefore, the reason for the dismissal was the failure of Mr Fitton and Mr Ewer to follow the instruction to move to Leatherhead.
When the EAT considered whether the dismissals were unfair, it decided that the instruction to move to Leatherhead was not a valid contractual requirement and that it was not a reasonable requirement either. The refusals to move to Leatherhead were reasonable and as such the dismissals were unfair.
This is an interesting case as it shows that whilst in an appropriate case a mobility clause might be used in a redundancy situation to avoid making redundancies, the terms of any clauses and the manner in which they are operated by the employer will be taken into account.
