Round #435

A manager wants to put just one employee at risk of redundancy rather than run a pool selection. In what circumstances is a pool of one lawful?

### Legal Context In UK employment law (under the Employment Rights Act 1996 and related case law), redundancy occurs when a role is no longer needed due to business changes, such as restructuring or reduced workload. Typically, if multiple employees perform similar roles, employers must use a fair selection pool to decide who is at risk, avoiding discrimination or unfairness. However, selecting a "pool of one" (i.e., targeting a single employee without comparing them to others) can be lawful in specific circumstances. This is guided by principles from cases like *William Hill Organisation Ltd v Tucker* [1998] and *Capita Hartshead Ltd v Byard* [2012], where tribunals assess overall fairness. ### When a Pool of One is Lawful A pool of one is permissible if it's objectively justifiable and the selection process remains fair. Key circumstances include: 1. **The Employee's Role is Unique or Distinct**: - If the employee's job functions are not interchangeable with others (e.g., a specialist role like a unique software developer with no similar colleagues), a pool of one is appropriate. The employer must demonstrate that no other employees share substantially similar skills, responsibilities, or reporting lines. - *Example*: Dismissing a lone IT manager whose role isn't duplicated elsewhere, without needing to pool them with general managers. 2. **The Redundancy Affects a Specific Location or Function**: - If the redundancy is tied to closing a particular site, department, or project where only one employee works, a pool of one is valid. This applies even if similar roles exist elsewhere in the organization, provided the business reason is location- or function-specific. - *Example*: Closing a remote branch with a single employee, or eliminating a standalone project role. 3. **Clear Business Rationale Without Arbitrary Selection**: - The decision must stem from genuine redundancy reasons (e.g., cost-cutting or reorganization), not personal bias, performance issues, or misconduct (which would require separate procedures). Tribunals will scrutinize if the pool was manipulated to target someone unfairly. - Supporting evidence: Consultation with the employee, objective criteria for the role's elimination, and no viable alternatives (like redeployment). ### Requirements for Lawfulness Even in a pool of one, the process must comply with redundancy rules to avoid unfair dismissal claims: - **Individual Consultation**: Hold meaningful discussions with the employee before decisions, explaining reasons and exploring alternatives (e.g., 1-2 meetings over weeks). - **Notice and Pay**: Provide statutory notice (or pay in lieu) and redundancy pay if eligible (2+ years' service). - **No Discrimination**: Ensure the selection doesn't breach equality laws (e.g., protected characteristics under the Equality Act 2010). - **Fairness Test**: If challenged, an employment tribunal evaluates the overall reasonableness. A pool of one fails if it appears contrived (e.g., redefining roles to isolate one person). ### Risks and Advice While lawful in the above scenarios, pools of one are risky and often challenged in tribunals (success rate for claimants ~30-40% in redundancy cases). Employers should document everything thoroughly. For tailored advice, consult an employment lawyer or ACAS, as outcomes depend on specifics. This is general guidance based on UK law as of 2023; it may vary by jurisdiction.

### When Is a Pool of One Lawful for Redundancy Selection? In UK employment law (under the Employment Rights Act 1996 and related case law), redundancy occurs when a role is no longer needed due to business changes, such as restructuring or closure. Normally, employers must use a fair selection process from a "pool" of similar employees to avoid discrimination. However, a **pool of one**—targeting a single employee without comparing them to others—can be lawful in specific circumstances. This is not the default approach and must be justified to avoid unfair dismissal claims (which could lead to tribunal awards up to a year's pay or more). #### Key Circumstances Where a Pool of One Is Lawful A pool of one is permissible if it's **genuinely the only affected role** and the redundancy is clearly role-specific. Courts (e.g., in cases like *Capita Hartshead Ltd v Byard* [2012] and *Fulcrum Pharma v Bonassera* [2010]) assess fairness based on consultation, genuine redundancy, and lack of alternatives. Here's when it's typically lawful: 1. **Unique or Standalone Role**: - The employee's job is distinct and not interchangeable with others. For example: - A specialist role (e.g., a unique IT architect for a discontinued project) with no similar positions in the organization. - A small business where the employee is the sole occupant of that function (e.g., the only bookkeeper in a tiny firm). - **Why lawful?** No "pool" exists because there's no one else doing comparable work. Targeting them isn't arbitrary—it's because the role itself is redundant. 2. **Department or Site Closure**: - If an entire department, site, or project is closing, and the employee is the only one in that area, a pool of one applies. - Example: Shutting down a remote office with just one administrator. - **Why lawful?** The redundancy is tied to the closure, not individual performance. Case law (e.g., *Rowell v Hubbard Group Services Ltd* [2008]) supports this if the business reason is genuine. 3. **No Suitable Alternative Employment**: - The role is eliminated, and no redeployment options exist within the business for that employee (or anyone else in a similar position). - This must be evidenced through proper consultation (see below). 4. **Small Employer Exceptions**: - In very small businesses (f.g., fewer than 20 employees), tribunals are more lenient if formal pooling would be impractical, provided the process is fair overall. - However, even here, you can't use it to mask bias (e.g., avoiding a difficult employee). #### Essential Requirements for Lawfulness Even in these scenarios, a pool of one isn't automatically fair. You must follow ACAS Code of Practice on Redundancy Handling to defend against claims: - **Genuine Redundancy**: Prove the role (not the person) is no longer needed. Document business reasons (e.g., cost savings, market changes). - **Individual Consultation**: - Notify the employee they're "at risk" in writing as early as possible. - Hold at least one meaningful meeting to discuss the situation, explore alternatives (e.g., redeployment, reduced hours), and consider their input. - Provide selection criteria if applicable (though with a pool of one, this is minimal—focus on fairness). - Allow time for response (typically 1-2 weeks minimum; more for longer-serving employees). - If no alternatives, issue a formal redundancy notice. - **No Discrimination**: Ensure the decision isn't influenced by protected characteristics (age, gender, disability, etc.) under the Equality Act 2010. A pool of one can invite scrutiny for bias, so keep records. - **Statutory Redundancy Pay and Notice**: - Eligible employees (2+ years' service) get statutory pay: up to 1.5 weeks' pay per year of service (capped at £700/week as of 2024; max ~£21,000). - Provide minimum notice (1-12 weeks based on service) or pay in lieu. - Offer time off to seek new work (up to 40% of a working day, paid). - **Avoiding Unfair Dismissal**: The employee has the right to appeal the redundancy decision. Failure to consult properly can make dismissal unfair, even if the pool is justified. #### Risks and When It's Unlawful - **Unlawful if Arbitrary**: If similar roles exist but you exclude them to target one person (e.g., ignoring two salespeople when cutting one sales role), it's unfair (*Vaughan v London Borough of Lewisham* [2013]). - **Larger Organizations**: In bigger firms, pools are expected for fairness—courts rarely accept a pool of one unless the role is truly isolated. - **Tribunal Scrutiny**: Employees can claim unfair dismissal within 3 months. Costs could include compensation plus legal fees. - **Collective Redundancies**: If 20+ employees are affected in 90 days, different rules apply (e.g., 30-45 days' consultation with unions)—a pool of one wouldn't fit here. #### Practical Steps for the Manager 1. Document the business case for why the role is uniquely redundant. 2. Issue an "at-risk" letter explaining the situation and inviting consultation. 3. Consult individually, exploring options. 4. If proceeding, calculate and offer statutory pay/notice. 5. Consider voluntary redundancy or settlement to avoid disputes. If this is for a specific scenario, consult an employment lawyer or ACAS (helpline: 0300 123 1100) for tailored advice, as outcomes depend on facts. This isn't legal advice—laws can change (last major update: 2024).