Redundancy situations must be carefully handled by employers and careful thought must be given to the pool or unit from which employees are to be selected for redundancy. An employer needs to choose the appropriate pool and apply appropriate selection criteria and be able to give a rational explanation for any decision it takes. Failing to identify the appropriate pool can lead to unfair dismissal claims.
Case Example: Taymech Ltd v Ryan UKEAT 663/94
No rules about the pool
There are no definite rules about the definition of the pool and tribunals have allowed employers a great degree of flexibility provided that they are able to offer rational explanations for their decisions. Tribunals will only consider whether pools are within the range of reasonable responses.
Employers seeking to make small reductions in the workforce will usually attempt to keep redundancy pools as narrow as possible and include the least number of staff in an attempt to keep disruption to a minimum. Employees within the pool will of course be keen to see the maximum number of employees within the pool so as to minimise their risk of being selected.
Who should be in the pool?
Any employee at a similar level doing the same sort of work or work that those in the pool have the skills to transfer into should be included in the pool. Employees at different geographical locations could even be considered if they are not a huge distance away.
Employees working in low-skilled work or who have undertaken a range of different roles for the same employer are more likely to have interchangeable skills and be a factor in deciding which employees should be within the pool.