Case law update by Sophie Sheerin following recent EAT Judgement in 'Carnival plc -v- Hunter [2024] EAT 167'

This was a successful appeal in the EAT by respondent employer and cruise operator Carnival plc (“the Respondent”). The decision revisits and clarified the relevant principles, under Regulations 10 and 20 of the Maternity and Parental Leave Regulations 1999 (MAPLE), for employers managing a redundancy exercise affecting employees on maternity leave.

Under Regulation 10, MAPLE, where an employee on maternity leave cannot continue in her role because of redundancy, she is entitled to be offered alternative employment under a new contract where there is a suitable alternative vacancy available. Where Regulation 10 is not complied with, that employee is entitled to be treated as automatically unfairly dismissed (Regulation 20, MAPLE).

Decision at first instance

Ms Hunter (“the Claimant”) had been employed by the Respondent for 13 years and was working as one of 21 contact centre team leaders. She went on maternity leave in early April 2020, after the start of the COVID-19 Pandemic. At the end of that month, the Respondent notified its employees that there would be company-wide redundancies. The Claimant was placed at risk of redundancy along with the other team leaders, whose number would be reduced to 16. Having ranked as one of the five lowest scorers in the redundancy exercise, the Claimant was selected for redundancy and was not offered one of the 16 remaining positions.

The ET found that Ms Hunter’s claim was made out, for both ordinary and automatic unfair dismissal, and that Regulation 10 had been engaged but not complied with. It held that the Claimant should have been offered one of the 16 remaining team leader roles, as these were suitable alternative vacancies.

Appeal

The appeal proceeded on four grounds:

1. Ground 1: The Tribunal had erred in finding a Regulation 20(2) claim made out, when only a Regulation 20(1) claim was before the Tribunal;
2. Ground 3: The Tribunal had erred in concluding that there was a suitable alternative vacancy per Reg 10(2);

• Ground 4: The Tribunal had failed to explain why it concluded that the remaining positions were alternative vacancies;

1. Ground 5: The Tribunal made a number of failings in its findings regarding the Respondent’s scoring in the redundancy exercise.

The appeal was allowed on all four grounds. The findings of ordinary and automatically unfair dismissal were therefore quashed, and the matter was remitted to the ET to be heard by a newly constituted panel.

The EAT’s decision in relation to ground 3 was of particular legal significance.

The ET had erred in finding that the 16 remaining team leader roles were suitable alternative vacancies under Regulation 10, MAPLE. These were not alternative vacancies. This was simply a reduction to the number of roles available, and there was no entitlement, under Regulation 10, for the Claimant to be permitted to remain in her role ahead of another colleague who had scored higher in the redundancy exercise. Nor was there any other evidence before the tribunal that there were other suitable alternative vacancies available.

By contrast, there could be an alternative redundancy scenario where, instead of reducing the number of existing positions, an employer amalgamates two or more roles, with the effect that a new vacancy is created. In that redundancy scenario, there would be an alternative vacancy available, Regulation 10 would be engaged, and the employee on maternity leave would therefore be entitled to be offered the new role ahead of a higher scoring colleague.

In any case, Regulation 10 is not engaged unless the employee on maternity leave is actually due to be made redundant and not merely at risk of redundancy.

These points are illustrated in the case of Sefton Borough Council v Wainwright [2015] IRLR, where roles were amalgamated in the redundancy exercise to create a new position. HHJ Eady QC (as she then was) held that the Claimant and a colleague were both effectively made redundant when their roles were extinguished and that they then competed for the new position. Regulation 10 therefore applied because the Claimant was an employee on maternity leave, who was redundant, and there was a suitable alternative vacancy, which she was entitled to be offered.

This can be distinguished from the present case where the team leader role itself survived the redundancy exercise and no new role was created. At the point where the Claimant was competing with colleagues for the 16 remaining team leader positions, she was only at risk of redundancy and not redundant for the purposes of Regulation 10. Therefore Regulation 10 did not apply and there was no entitlement for her to be offered one of the roles ahead of her colleagues.

Significance

The case provides helpful clarification that Regulation 10 only applies where there is a suitable alternative and not merely a remaining vacancy available. It is also an instructive reminder that the employee on maternity leave need actually be redundant and not merely at risk of redundancy.

Regulation 10 therefore does not require that an employee on maternity leave remains in her role over higher scoring employees in a redundancy exercise which reduces the number of existing positions.

Such certainty will no doubt be welcome for employers navigating the practicalities of maternity protection in various redundancy scenarios.

Sophie Sheerin shadowed James Bromige at the EAT Hearing where James was successful on behalf of his Client Carnival Plc. To instruct either Counsel please contact the Clerks via employment@qsc.law