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In the case of Ostendorf v Barclays Capital Services Ltd UKEAT/0202/13/DA the Employment Appeal Tribunal (“EAT”) upheld the Employment Tribunal’s ruling that the redundancy process carried out by the employer was not a sham.

The factual background of Ostendorf v Barclays Capital Services Ltd

Milko Ostendorf commenced employment with Barclays Capital Services Ltd (“Barclays”) on 1 August 2003 and at the times relevant to this case he was Global Head of Funding Structuring. Mr Ostendorf was dismissed from his employment on 5 November 2010 for the reason of redundancy and brought a claim for unfair dismissal against Barclays, arguing that redundancy was not the true reason for his dismissal and that he had in fact been dismissed because he had devised a particular financial transaction which was estimated to be extremely lucrative to Barclays. Barclays argued that there was a genuine redundancy situation and that the financial transaction had in no way impacted upon the decision to make Mr Ostendorf redundant.

In December 2012 the Employment Tribunal found against Mr Ostendorf in his claim as it found that there was a genuine redundancy situation and the redundancy process used had not been unfair. In October 2013 Mr Ostendorf made an application for reconsideration on the grounds that he believed that further evidence had come to light that showed that Barclays had in 2012 used the financial transaction he had created. A further hearing was held in October 2015 and the application for reconsideration was dismissed in December 2015.

The decision of the Employment Tribunal

The Employment Tribunal dismissed Mr Ostendorf’s application for reconsideration, holding that the new evidence that he had put forward did not show that Barclays had implemented Mr Ostendorf’s financial transaction in 2012 and, further, that Mr Ostendorf’s dismissal had nothing to do with the financial transaction he had devised. The Tribunal again found that the true reason for Mr Ostendorf’s dismissal was redundancy and that the decision was fair.

Mr Ostendorf appealed the decision of the Employment Tribunal on the following grounds:

  1. That the Tribunal had not correctly placed the burden of proof on Barclays to show that the reason for the dismissal was redundancy; and
  2. That the Tribunal had reached conclusions for which it had no supporting evidence, rendering the Tribunal’s conclusions perverse

The decision of the Employment Appeal Tribunal

The EAT found that the Tribunal had in fact found that Barclays had established that the reason for Mr Ostendorf’s dismissal was redundancy. The EAT also found that there was in fact sufficient supporting evidence for the Tribunal’s conclusions and dismissed that ground of appeal as lacking merit.

The EAT also commented that it believed that the ‘true objection’ that Mr Ostendorf had to the decisions of the Employment Tribunal was the fact that the Tribunal had not reached the same conclusion as Mr Ostendorf and his expert on the unfairness of his dismissal.

Chris Hadrill, a specialist employment solicitor at Redmans, commented on the case: “It can often be difficult for Claimants in unfair dismissal cases to establish that the real reason for their redundancy was a sham, as most employers will take careful steps to ensure that the reason for the redundancy, and the process used, is well-documented.”

The Employment Appeal Tribunal’s judgment in Ostendorf v Barclays Capital Services Ltd can be found here.

About

Redmans Employment Team deal with employment matters for both employers and employees, including drafting employment contracts and policies, advising employers and employees on compromise agreements, handling day-to-day HR issues, advising on restructures, and handling Employment Tribunal cases for both employers and employees

Call 020 3397 3603 to speak to one of the members of our employment team or email us on enquiries@redmans.co.uk.

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