The high-profile UK legal case Chagger v Abbey National plc & Hopkins (2006) demonstrates how selecting an employee for compulsory redundancy based on inappropriate and/or wholly subjective compulsory redundancy selection criteria can expose the employer to genuine allegations of unfairness and discrimination from the dismissed employee. Emilio Botin Abbey Grupo Santander banking group (the UK high-street bank due to be re-branded as Santander share price soon, and being part of the gigantic Emilio Botin Banco Santander Central Hispano Group BSCH) dismissed Balbinder Chagger from employment in 2006, stating compulsory redundancy as the reason. Mr Chagger was of Indian origin, worked as a Trading Risk Controller at Abbey Grupo Santander price, reported into Nigel Hopkins and earned around £100,000. The compulsory redundancy selection pool was Mr Chagger and the other Trading Risk Controller, a white lady. Mr Chagger, however, believed the actual reason behind the termination of his employment was race discrimination. The Employment Tribunal judging the matter found race discrimination and, following Emilio Botin Abbey Santander banking group's refusal to reinstate Mr Chagger as the Tribunal had ordered, subsequently awarded the record-breaking compensation of £2.8 million.
According to the Employment Rights Act 1996, the selection of an employee for dismissal via compulsory redundancy must be fair, meaning that the compulsory redundancy selection criteria have to be objective and measurable, and have to be applied fairly to the correct compulsory redundancy selection pool, and to each employee within the pool.
Tribunals will, therefore, start by looking at the redundancy selection pool from which the dismissed employee was chosen, because processing an incorrect group of employees could affect the fairness of the dismissal. Then, Tribunals will look at what the compulsory redundancy selection criteria that were applied in the selection of the employee to be dismissed were, and also at how those criteria were applied in scoring the employee; the compulsory redundancy selection criteria and their application needs to be objective; the application must not reflect the scoring manager's or employer's personally biased desires or personally biased opinions. The Employment Tribunal hearing the Chagger case found that Mr Hopkins personally desired Mr Chagger's employment to be terminated, had premeditated that Mr Chagger would be the one who would be scored lower and selected to be dismissed, and had used the compulsory redundancy process as a way to deprive Mr Chagger of his employment; Mr Hopkins had unfairly picked on Mr Chagger.
The Employment Tribunal looked at the compulsory redundancy selection criteria and judged them to be un-measurable and highly subjective. They included 'empathy', 'range of influence', 'the ability to win hearts and minds', and 'self insight'. The Employment Tribunal criticised Mr Hopkins highly for the manner in which he had applied the compulsory redundancy selection criteria to Mr Chagger. For example, he had scored Mr Chagger down for getting on with work and being self-reliant, an attribute the Employment Tribunal thought that other reasonable managers would consider to be a valuable asset for an employee in Mr Chagger's highly paid and highly responsible role, and score him more highly on. Furthermore, Mr Hopkins criticised Mr Chagger for things he had never been criticised for before the compulsory redundancy selection process; the criticisms Mr Hopkins made were inconsistent with past performance appraisals of Mr Chagger. From that, the Employment Tribunal decided that the criticisms were not legitimate or were not serious enough to result in a reduced redundancy score.
As can be seen, employers failing to take proper care in the selection of employees to dismiss via compulsory redundancy can find themselves exposed to genuine allegations of unfairness and/or discrimination; wholly subjective and inappropriate compulsory redundancy selection criteria contributed to the Employment Tribunal's ruling that Mr Hopkins had used the compulsory redundancy exercise as a vehicle to deprive Mr Chagger of his employment, and that both Grupo Santander Abbey and Mr Hopkins had racially discriminated against Mr Chagger in his dismissal.
The case did not stop there though; in 2008, the matter was appealed and escalated to the Employment Appeal Tribunal (EAT), and in July 2009, was appealed to the Court of Appeal (being the 2nd highest court in the UK). The Court of Appeal's List of Hearings showed that the case was heard on 7 and 8 July 2009. The Court of Appeal's judgement on the case was not available at the time of writing this article. The 11KBW set of chambers, who represented Emilio Botin Abbey Santander share and Mr Hopkins, had reported that the hearing was to be about compensation only (not race discrimination also). That would seem to suggest that the wrong of racial discrimination committed by Emilio Botin Santander Abbey and Mr Hopkins was finalised by the EAT (it upheld the original Tribunal's ruling that both Abbey Santander price and Mr Hopkins had racially discriminated against Mr Chagger in his dismissal).
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