In times when many businesses are sadly having to consider downsizing, the obligation to consult employees about proposed redundancies can sometimes be counter-intuitive. Where the business, or one particular site is closing entirely, consultation with employees about redundancy can seem futile if there appear to be no alternatives.

Nevertheless, a failure to consult may still lead to the redundancy being found to be unfair, as a recent case in the Employment Appeal Tribunal (EAT), Carillion Services Ltd (In compulsory liquidation) and others v Benson and others 2021 has confirmed. In this case, regrettably there was a compulsory liquidation and the employer sought to rely on the ‘special circumstances’ defence to argue that consultation was not necessary and would have changed nothing for the employees. The EAT did not agree that the withdrawal of financial backing by its investors, meaning that the company would fold, would amount to ‘special circumstances’. The EAT reiterated that events must be “out of the ordinary, or something uncommon” to amount to special circumstances. A timely reminder that a process of consultation with employees should always be factored into a plan to close or reduce operations, even if there appears little to be achieved, and that ‘special circumstances’ which justify no consultation will be very rare indeed.

If you would like further advice tailored to your particular circumstances, please contact us.