Tue 31 Aug 2021

Unfair dismissal - furlough as an alternative to redundancy

The question of whether it is unfair to dismiss an employee on the grounds of redundancy when it would have been possible to furlough them has been looked at by two separate Employment Tribunals.

In the first case, the Employment Tribunal ("ET") held that an employee was unfairly dismissed as her employer did not consider utilising the Government's Coronavirus Job Retention Scheme ("Furlough Scheme") as an alternative to making the employee redundant. The full judgement of Mhindurwa v Lovingangels Care Limited ("Lovingangels") can be found here.

In this case, Mrs Mhindurwa ("the Claimant") was employed as a live-in care assistant for a client of Lovingangels ("the Respondent") and she had two years' service. However, after the requirement for the Claimant to provide the client with live-in care ceased, the Claimant was dismissed by the Respondent by reason of redundancy. Following an unsuccessful appeal, the Claimant brought an unfair dismissal claim at the Employment Tribunal. The Claimant argued that instead of being dismissed she should have been furloughed, a request she made to her employer in May 2020.

The ET held that the Claimant was unfairly dismissed as her employer did not properly consider furlough as an alternative to redundancy. The Judge ruled that a reasonable employer would have considered furlough as an alternative, even on a temporary basis, to see if work for her role would pick up again.  This judgment was subsequently upheld in the EAT - the full EAT judgement can be found here.

By stark contrast, in the second tribunal case, the ET came to a different conclusion, finding that an employee, who was supported under the Furlough Scheme, was not unfairly dismissed on the sole basis that his employer decided to make him redundant instead of choosing to have him furloughed for longer. The full judgement of Handley v Tatenhill Aviation Ltd ("Tatenhill") can be accessed here.

In this case, Mr Handley ("the Claimant") was employed as a flying instructor to provide flying lessons to customers of Tatenhill ("the Respondent"). Following the announcement of the first lockdown, the Respondent decided to close. It was agreed that the Claimant would be furloughed for three weeks initially or until he could return to work as normal. However, the Respondent's business had been struggling financially pre-lockdown and then post lockdown there was no income coming in from the Claimant's section of the business so the Respondent decided to consider redundancies. Out of the two flying instructors the Respondent employed, the Claimant was selected to be made redundant and his employment terminated on 10 August 2020.

The Claimant was made redundant while he was on furlough. In his claim for unfair dismissal before the ET, he argued that he should have been furloughed. The ET disagreed stating that regardless of the Furlough Scheme, the employer had a need to cut costs to protect its business. The ET also considered that while another employer may have chosen to leave the Claimant on furlough for longer, it was open to the Respondent not to do so.

The cases highlight that, based on the facts and merits of each case, Tribunals can ultimately reach different conclusions. Neither decision is binding on other Employment Tribunals and it remains to be seen if either case is appealed.



Make an Enquiry

From our offices we serve the whole of Scotland, as well as clients around the world with interests in Scotland. Please complete the form below, and a member of our team will be in touch shortly.

Morton Fraser MacRoberts LLP will use the information you provide to contact you about your inquiry. The information is confidential. For more information on our privacy practices please see our Privacy Notice