Redundancy (1): the definition of redundancy

by Practical Law Employment

A practice note that provides guidance on the statutory definition of redundancy under section 139(1) of the Employment Rights Act 1996 (ERA 1996). This practice note outlines the crucial three-stage test from the leading case, Safeway Stores plc v Burrell [1997] ICR 523, for determining whether a dismissal is by reason of redundancy. It explores the circumstances that constitute a redundancy, including business closures, workplace closures, and a diminished requirement for employees to perform work of a particular kind. The guidance examines each stage of the test, addressing complex issues such as what constitutes a dismissal, the impact of mobility clauses, and the distinction between a genuine redundancy and a business reorganisation. This practice note also discusses related concepts, including "bumping", outsourcing, and situations where an employer might rely on some other substantial reason (SOSR) for dismissal. It highlights common areas of dispute and analyses key case law to illustrate how tribunals approach these fact-sensitive scenarios, providing valuable insights for employers navigating potential workforce reductions and unfair dismissal risks.