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Attitudes to organisational change – grounds for a fair dismissal?

Thursday, June 8, 2017

With many organisations, both public and private, under pressure, the reorganisation has become common place. Drives for efficiency, and attempts to weather the storms of austerity, deal with fluctuating markets, and relieve pressures on resources can all contribute towards a decision to undertake a reorganisation. The changes which a reorganisation will entail can leave employees feeling unsettled, regardless of whether redundancies result. It's almost inevitable that some employees, even at relatively senior levels, may be sceptical about the benefits of any proposed reorganisation, or even lobby against the changes. In this blog, we look at whether - and if so at what point - an employee's attitude to organisational change can amount to grounds for a fair dismissal.

Unfair dismissal recapped

For a dismissal to be fair, it must be for a 'fair reason'. The dismissal must also be handled fairly, both in terms of the dismissal procedure, and in treating the reason for dismissal as sufficient for dismissal. There are 5 potentially fair 'general' reasons for dismissal, set out in s. 98 of the Employment Rights Act 1996:

-          Capability

-          Conduct

-          Redundancy

-          Statutory illegality

-          Some other substantial reason

Where does attitude to organisational change sit?

Within this range of potentially fair reasons, an employee's attitude to organisational change could potentially sit within capability, conduct or 'some other substantial reason'. 'Capability' is potentially the reason if the attitude derives from an inability to take on the new responsibilities or duties asked of him or her following the change. One of the most cited examples of 'some other substantial reason' is the reorganisation which falls short of redundancy, but nevertheless means that certain employees are not suitable for roles in the reorganised structure.

On other occasions, however, an employee's attitude to a properly thought out restructure will sit within the 'conduct' reason for dismissal. This was certainly the view of the Court of Appeal in the recent case ofAdeshina v St George's University Hospital NHS Foundation Trust & others[2017] EWCA Civ 257. In this case the Court of Appeal upheld an Employment Tribunal's conclusion that the dismissal of Ms Adeshina for gross misconduct was fair and not wrongful following her failure to co-operate with and implement changes arising from a restructure of the pharmacy department in which she held a managerial position.

Conduct 'incompatible with the role of a manager'

Looking at this more widely, the conduct could be seen in the same light as the conduct of Mr Adesokan inAdesokan v Sainsburys Supermarkets Ltd[2017] EWCA Civ 22. In that case, Mr Adesokan failed to take action to rectify a serious situation in relation to a management initiative. The situation had arisen as the result of another employee's actions. Mr Adesokan was nevertheless summarily dismissed for gross misconduct despite his previously unblemished service record of 26 years. Although the facts are quite different, in both cases, it could be said that the Court found that both Mr Adesokan and Ms Adeshina had not conducted themselves in a way that was compatible with their senior positions in their respective organisations.

Differences of opinion should not be penalised

Of course, in any organisation it should be possible for employees at any level to express their opinions without fear of repercussions. Equally, once decisions have been taken and new structures put in place, employers should be confident that their managers will set aside any personal misgivings to implement changes and move forward. If an employee has fundamental problems with the restructure it is of course an option to seek alternative employment elsewhere, although this may be harder to achieve in practice. However, employers have to be particularly careful where the concerns the employee raises amount to a protected disclosure under the legislation protecting whistleblowers.

As employers in all sectors head towards more economic uncertainty, we may well see more of these situations arise, and further interesting developments in the case law on this area.

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