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Can an employee claim unfair dismissal for redundancy if they refuse to relocate under a mobility clause?
No, but the dismissal may be unfair for other reasons. In Kellogg Brown & Root (UK) Ltd v Fitton and Ewer, the Employment Appeal Tribunal (EAT) considered whether an employment tribunal had erred in finding that two employees had been dismissed for redundancy when their employer had purported to rely on a mobility clause in their contract of employment to move them to another office when their office closed.
Kellogg is an engineering, construction, technology and services company. It had offices in Greenford and Leatherhead. Mr Fitton and Mr Ewer worked at Greenford. The mobility clause in their employment contract provided that:
“The location of your employment is…. but the company may require you to work at a different location including any new office location of the company either in the UK or overseas either on a temporary or permanent basis. You agree to comply with this requirement unless exceptional circumstances prevail.”
Kellogg closed the Greenford office and notified the employees that they would be transferring to the Leatherhead office. Mr Fitton lived in Harrow and Mr Ewer lived in St Albans. Both objected to the greatly increased travelling time they would incur. They argued that the mobility clause was unenforceable so they should be dismissed for redundancy and receive a redundancy payment. Kellogg disagreed and both were summarily dismissed for unacceptable conduct in refusing to relocate in accordance with their employment terms. Both brought claims of unfair dismissal and a statutory redundancy payment. The employment tribunal held that their place of work had been Greenford and found the mobility clause was very wide and lacked certainty. It further found that the instruction to work in Leatherhead had been unreasonable given the greatly increased travelling time. In this case, the reason for dismissal was redundancy and therefore the dismissals were unfair. Kellogg appealed.
The EAT allowed the appeal on the basis that Kellogg dismissed them because it believed it could rely on the mobility clause and that the instruction to move to Leatherhead was a reasonable instruction that Mr Fitton and Mr Ewer had refused to obey. Accordingly, the reason for dismissal was not redundancy but their alleged misconduct. However, the dismissals were still held to be unfair.
This case illustrates the confusion that can arise when an employer seeks to exercise a contractual mobility clause against a backdrop of a redundancy situation. Using a mobility clause may enable an employer to avoid dismissing an employee for redundancy. However, if the employee is dismissed for failure to carry out an instruction to move under a mobility clause, that dismissal will be for misconduct and not redundancy and will be unfair if the instruction is unreasonable.
If you have a mobility clause in your employee contracts you can discuss the legal ramifications with our Employment Solicitors. BBS Law has years of experience in commercial contracts so contact us today.