Dismissal for Refusing to Comply with Mobility Clause Unfair

Employees dismissed for refusing to comply with a contractual mobility clause had been unfairly dismissed. 

Speedread

Employees who were dismissed for refusing relocate under the terms of a contractual mobility clause had not been dismissed by reason of redundancy. The fact that dismissals took place against the backdrop of a redundancy situation did not mean that redundancy was the reason for dismissal. The employees were not therefore entitled to a statutory redundancy payment. The employees’ dismissals were nevertheless unfair as the instruction to relocate was unreasonable and their refusal to comply had been reasonable. 

Facts

In Kellog Brown & Root (UK) Ltd v Fitton and Ewer, Mr Fitton and Mr Ewer worked at Kellog Brown & Root’s (Kellog) Greenford office. Their employment contracts contained a mobility clause which stated that it could require them to work from any other office location in the UK or overseas on a temporary or permanent basis. Kellog decided to close its Greenford office and told the employees that they would transfer to its Leatherhead office. 

Mr Fitton and Mr Ewer both objected to moving to Leatherhead. Mr Fitton lived in Harrow and could either walk to work or get the Underground, which took about 20 minutes. He did not have a car. His commute to Leatherhead would take two hours each way. Mr Ewer had worked for Kellog for 25 years, 15 of those in the Greenford office and he had always lived in St Albans. He was nearly 64 and the move to Leatherhead would increase his commute from 18 miles each way to 47 miles each way. 

Kellog instructed them to transfer to Leatherhead. They refused to do so. Following disciplinary hearings, they were summarily dismissed for refusing to comply with the Company’s instructions. They claimed unfair dismissal and a statutory redundancy payment.

The employment tribunal upheld their claims, finding that their place of work was Greenford and that they had been dismissed by reason of redundancy due to the closure of their workplace. The dismissals were also unfair. Kellog had followed a disciplinary procedure which was inappropriate in cases of redundancy and had failed to consult or warn employees or search for alternative employment.

Kellog appealed.

Decision

The Employment Appeal Tribunal (EAT) agreed with Kellog that its reason for dismissal was not redundancy. Although there may have been a redundancy situation, the employment judge had found that Kellog believed it had the right to instruct the employees to relocate and it was their refusal to obey that instruction that caused it to dismiss. The reason for dismissal was therefore misconduct. As the employees had not been dismissed by reason of redundancy they were not entitled to a statutory redundancy payment. 

However, the EAT upheld the employment tribunal decision that the dismissals were unfair. The employment judge had concluded that the mobility clause was too wide and uncertain, that the instruction to relocate was unreasonable (given the increased travelling time) and that the employees’ refusal to relocate was reasonable. It had therefore been entitled to find that the dismissals were unfair. 

Implications

Mobility clauses can be useful as they give the employer the power to relocate an employee where their workplace closes, rather than having to make them redundant. Where the employee refuses to comply with a mobility clause and is dismissed as a result, the dismissal will be on conduct grounds, rather than redundancy. Whether the dismissal is fair will depend on whether the instruction was lawful (i.e. whether it falls within the scope of the mobility clause), whether the instruction to relocate was reasonable (for example whether adequate notice of the move given) and whether the employee acted reasonably in refusing to comply (which will depend on the employee’s own particular circumstances).