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Unfair dismissal: furlough as a suitable alternative to redundancy

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What is furlough fraud?

In the case of Lovingangels Care Ltd v Mhindurwa, the employment appeal tribunal has recently upheld an employment tribunal’s ruling that an employer’s decision to dismiss an employee by way of redundancy, as opposed to placing them on furlough leave, amounted to unfair dismissal.

The facts of the case

Ms. Mhindurwa worked as a live-in carer for Lovingangels Care Limited. During the coronavirus pandemic, Ms. Mhunduwa’s role was placed at risk of redundancy. This was because the person she cared for, went into hospital. Usually, Ms. Mhunduwa would have been placed to care for another of her employer’s clients. However, due to covid restrictions, this was not possible.

During her redundancy consultation, Ms. Mhindurwa asked to be placed on furlough leave, instead of being made redundant. However, this was refused by her employer, and she was dismissed by reason of redundancy.

The employment tribunal and employment appeal tribunal decision

Subsequently, Ms. Mhindurwa brought a claim against her former employer at the employment tribunal for unfair dismissal. The basis of her claim was that her former employer ought to have considered furlough leave as an alternative to redundancy.

The tribunal ruled in favour of Ms. Mhindurwa, and agreed that before dismissing her, her employer should have considered the possibility of placing her on furlough leave at the very least, until her employer established whether the situation was likely to improve.

The tribunal ruled that the covid ‘job retention scheme’ was introduced to ‘avoid laying off employees’ during the pandemic, and that it would have been reasonable for Ms. Mhundurwa’s employer to have taken advantage of this, instead of making her redundant.

Lovingangels Care Limited appealed the decision of the employment tribunal. However, the employment appeal tribunal upheld the employment tribunal’s original decision and found that there was ‘no error of law’ in the tribunal’s judgment.

What impact does this case have?

The tribunal’s judgment re-affirms the principle that as part of a fair redundancy process, employers should always consider whether there are any ‘suitable alternatives’ to dismissal.

Usually, a suitable alternative will be an alternative job role within an organisation. However, in circumstances where a redundancy occurred during the covid pandemic, employers would also have been required to consider the possibility of placing individual employees on furlough leave, rather than making them redundant.

Although this is not necessarily a landmark case, it is an interesting one, as it demonstrates the impact that the pandemic had with regards to decision making in the workplace

If you feel that you have been unfairly dismissed, if you require advice regarding any employment dispute, or if you require HR assistance, and would like more information, you can speak to a member of our team on 0161 696 6170.