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In the case of Ms Jenna Storie v Clyde Property Ltd S/4100303/17, the Employment Tribunal held (by a majority with the Employment Judge dissenting) that a female employee was entitled to compensation after her employer automatically unfairly dismissed her by failing to offer her a more senior role in the same department she was being made redundant from whilst on maternity leave.

The facts in Ms Jenna Strie v Clyde Property Ltd

Clyde Property Limited (the “Respondent”) was an estate agency business.  Ms Strie (the “Claimant”), was a Financial Controller at the Respondent.  The accounts department was led by the Finance Director, who was the Claimant’s sister and included an accountant who sat below the Claimant in the management structure.

The Claimant commenced maternity leave on 14 June 2016 and was due to return on 14 June 2017.  Mr Thomson, the Managing Director of the Respondent, instructed an external firm to advise on the structure and value for money of the accounting function and they produced a report in July 2016 which stated that there were efficiencies that could be made that might mean there would be a reduction in the number of people required in the accounts department.

The new structure proposed by the consultant that carried out the review deleted the posts of the three accountants and replaced them with one Senior Financial Controller post.  The post attracted a higher salary than the Claimant’s and the accountants, but below that of the Finance Director.

On 1 September, Mr Thomson wrote to the three accountants in the department advising them that their roles were at risk of possible redundancy.  Mr Thomson did not consider the post of Senior Financial Controller to be a suitable alternative vacancy so did not offer it outright to the Claimant.

Both the Claimant and Mr Dunwoodie, the accountant, applied for the post.  Mr Thomson scored selection criteria in respect of both of them with the Claimant scoring 65 points and Mr Dunwoodie scoring 69 points. Mr Dunwoodie was offered the job and the Claimant appealed the decision to make her redundant.  In her appeal she argued that: (a) there was no need to make redundancies; (b) she should have been offered the role of Senior Financial Controller because she was an employee on maternity leave and it was a suitable alternative vacancy and (c) the scoring criteria were unfair and placed her at a disadvantage because she was an employee on maternity leave. The Claimant’s appeal was not upheld and her employment was terminated on 4 October 2016.

The Claimant brought a claim in the Employment Tribunal alleging that she had been unfairly dismissed and discriminated against on the grounds of pregnancy and maternity. The Claimant believed she had been dismissed because she had exercised her right to take maternity leave and not for reasons of redundancy as asserted by the Respondent.  The Claimant also argued that if there was a redundancy situation, she had been selected for redundancy because she was on maternity leave.  Finally, she argued that the Respondent failed to offer her the suitable alternative vacancy of Senior Financial Controller in breach of Regulation 10 of the Maternity and Parental Leave Regulations 1999 (“MAPLE”) and as a result her dismissal was automatically unfair.

The decision of the Employment Tribunal (ET)

The Employment Tribunal held that there had been a genuine redundancy situation at the Respondents and found that there was no basis for the Claimant’s assertion that she was dismissed because she was on maternity leave.  They also held that there was no evidence, either direct or by way of inference, to support the Claimant’s contention that she was scored less than Mr Dunwoodie in the redundancy process because she was off on maternity leave at the time the exercise was carried out.

Two members of the Tribunal decided that the post of Senior Financial Controller was a suitable alternative vacancy in terms of Regulations 10 of MAPLE, and, accordingly, should have been offered to the Claimant.  As a result, the Claimant’s dismissal was automatically unfair.  Interestingly, the Employment Judge did not agree with the decision of the members and found that the post was not a suitable alternative.  In coming to this decision, he took into account the facts that: (a) the role was at a higher level in terms of status, seniority and salary than the Claimant’s post; (b) it would be the sole accountancy role in the company and; (c) it included responsibility for additional tasks and decision-making which were tasks in which the Claimant had no experience.

The Employment Tribunal awarded the Claimant the sum of £29,461 in compensation, comprised of:

  • Loss of earnings: £22,203
  • Injury to feelings: £6,500
  • Loss of statutory rights: £400
  • Loss of pension contributions: £358

Our solicitors’ views on the case of in Ms J Storie v Clyde Property Ltd

Sacha Barrett, a Senior Associate in the employment department at Redmans, made the following comment on the case: “The decision in this case was interesting in that the Employment Judge disagreed with the two members who decided that a role which attracted a higher salary, more status and included responsibilities never carried out by an employee before, could constitute suitable alternative employment.  In particular, it highlights the need for employers to consider very carefully alternative positions in their company before dismissing an employee that is on maternity leave in a redundancy situation.”

The decision of the Employment Tribunal in Ms J Storie v Clyde Property Ltd: S/4100303/17 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. Redmans have offices in Richmond, Chiswick, Hammersmith, Fulham, Kingston, Wimbledon, Ealing, Kings Cross and Marylebone (meetings strictly by appointment only).

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