A key aspect of a fair redundancy process is having fair, reasonable, objective selection criteria which are applied consistently and are not discriminatory in any way. However, this can sometimes be difficult to achieve in practice and getting it wrong can have costly financial and reputational consequences for organisations.

The recent case of Wayne Norman v Lidl Great Britain Ltd (ET) 1804509/23, provides a salutary warning in this regard. In this case, which was widely reported in the media, an employee was awarded almost £51,000 in compensation (in addition to over £17,000 in redundancy pay already received), following a procedurally unfair, and indirectly discriminatory, redundancy process which led to his dismissal; despite his employer’s genuine attempt to carry out a fair process. 

We take a closer look at the case below and explore the key lessons for employers.

What happened in the Norman v Lidl case?

Mr Norman, who was in his 60s, worked for Lidl as a Senior Construction Consultant, in its regional property office in Doncaster. In January 2023, due to a reduction in store openings and redevelopments, there was a restructure of Lidl’s regional property offices. The number of Senior Construction Consultants in the Doncaster office was to be reduced from 3 to 1. 

The consultation process started on 30 January, with an all-staff meeting. Selection for roles was to be by way of selection matrix, with criteria including experience, knowledge (including consideration of “relevant construction qualifications”), skills, overall performance, and disciplinary record; all to be rated out of 4. Managers were given guidance about the process, and scoring, which included a statement that any circumstances that had come about as the result of an employee’s protected characteristic should be disregarded. 

Mr Norman scored 17 points out of a possible 20 (4 for experience, 3 for knowledge, 3 for skills, 3 for overall performance and 4 for disciplinary record). One of the two colleagues in his pool scored 18 points (the only difference being a 4 for knowledge), and the other scored 11 points. No written notes of the rationale behind the scoring process were retained, because managers had been instructed to destroy these once scoring had been carried out. On 15 February, Mr Norman was given a copy of his scores (without any information as to how they had been reached) and was told that he had been provisionally selected for redundancy. Alternative roles were made available, but these were stated to require a university degree qualification (which Mr Norman did not have). 

A first individual consultation meeting was due to take place on 20 February, but in the interim Mr Norman asked his Line Manager if he could challenge his scores and he was told that he could not. He also discovered that colleagues and external contractors already knew that he was being made redundant and that his colleague was being confirmed in post. Mr Norman initially declined to attend the consultation meeting, because he had been told that he could not challenge his scores, and he felt a decision had already been made and the meeting was therefore pointless. However, he subsequently agreed to attend a rescheduled meeting, after being reassured that he would in fact be given the opportunity to challenge his scores.

During the rescheduled meeting on 27 February, Mr Norman was told that he had been marked down on the knowledge criterion “for not having “relevant construction qualifications” [i.e.] a construction degree”, and that his scores would not be changed. There was also some discussion about the fact that the alternative roles being offered had a degree requirement, and that Mr Norman did not consider them suitable alternatives.

At a second individual consultation meeting on 10 March, Mr Norman’s selection for redundancy was confirmed and his employment terminated with immediate effect. Mr Norman appealed. He said that his lower score for the knowledge criterion, on the basis that he did not have a degree, was discriminatory due to age, given the proportion of people of his age group who had degrees. His appeal was eventually withdrawn.

Mr Norman brought claims in the Employment Tribunal (“Tribunal”) for unfair dismissal and indirect age discrimination (amongst others). 

A little over a year after his employment had ended, Lidl offered Mr Norman his old job back. Mr Norman rejected the offer because he felt that he had lost all trust and confidence in the company, and did not feel able to return to work for the managers who had made him redundant.

The Employment Tribunal’s decision

The Tribunal upheld Mr Norman’s unfair dismissal and indirect age discrimination claims (but dismissed claims of direct age discrimination and age related harassment). 

In relation to the unfair dismissal, the Tribunal found that, though there was a genuine redundancy situation, and though there had been a genuine attempt to assess Mr Norman against his colleagues when deciding who to select for redundancy:

  • The scoring process had been flawed. 
    • Those carrying it out did not have “sufficient awareness of their roles, including the need to be able to objectively justify their decision-making”. Though the managers involved had been given guidance, it was “lacking in terms of advice both as [to] how to provide scores which were demonstrably evidence-based and the level of challenge those scores might be subjected to”. There was a lack of understanding as to the process to be followed.
    • It could not be concluded that the method of scoring was fairly and reasonably applied in Mr Norman’s case, and there was no effective moderation of scores. Those carrying out the scoring had struggled to explain the factors that they had relied on in arriving at their scores, and at the final hearing had given retrospective justifications which were not in their minds at the time. In particular, Mr Norman’s score in relation to the key criterion of knowledge could not be said to be reasonable. However, Mr Norman’s scores in relation to the remaining criteria of experience, skills and overall performance were reasonable, notwithstanding the flaws in the process.
    • Mr Norman was not told the basis of the scores awarded to him, or what had been considered against each individual criterion, or given a cogent explanation as to how his scores had been reached. There was no explanation of the scoring, or how scores had been reached, on the matrix. This meant that he was unable to reasonably challenge his scoring, and have his representations properly considered, before a final decision was made.
    • The suggestion made to Mr Norman during the process, that scoring could not be challenged, was inconsistent with the Respondent’s actual intentions and its guidance documentation. This again showed a lack of understanding of the process to be followed.
  • The consultation process had not been reasonable, and had “significant defects”, which rendered the dismissal procedurally unfair.
    • Mr Norman should have been given an explanation of the scoring in advance of the first individual consultation meeting, so that he could challenge those scores on an informed basis, but he was not. There should then have been an adjournment whilst feedback given was considered, followed by an additional consultation meeting to discuss the outcome. This did not happen.
    • The second individual consultation meeting on 10 March was not a consultation meeting at all. A decision had already been made, and the Respondent was simply seeking to go through a prescribed script and confirm the outcome at this meeting. It was a “tick-box” exercise, aimed at exiting Mr Norman promptly from the business.
  • However, the Tribunal also held that there was a 50% chance that Mr Norman would have been dismissed in any event (and the colleague who was ultimately confirmed in post, who was described as “exceptional”, still confirmed in post) had a fair process been followed. It commented that the competition between the two was “always extremely finely balanced”. The compensation awarded would therefore be reduced by 50% to reflect this (known as a “Polkey” reduction).
  • The Tribunal also found that Mr Norman’s refusal of the job offer from Lidl meant that his loss of earnings should be limited up to the date on which that role would have started (1 July 2024).

In relation to the indirect age discrimination, the Tribunal found that:

  • The inclusion in the redundancy scoring criterion for “knowledge”, of having a degree, was a “provision, criterion or practice” (“PCP”) which was applied neutrally to all who were at risk but put Mr Norman at a particular disadvantage in relation to his age (in comparison to the colleagues in his pool, who were younger than him and in their 30s). It was therefore indirectly discriminatory.
    • Mr Norman had produced statistical evidence that showed that those in their 60s were less likely to have a degree qualification than those in their 30s. The Tribunal noted that this was unsurprising, said that it was an issue on which “judicial notice” could be taken, and accepted it as fact.
  • Lidl failed to put forward any defence showing that the PCP was objectively justifiable as a proportionate means of achieving a legitimate aim.
  • However, the Tribunal also found that, had the indirectly discriminatory factor been absent, Mr Norman and the colleagues in his pool would still have been awarded the same scores for the knowledge criterion. This meant that there had been no financial loss as a result of the indirect discrimination, and compensation for this element of the claim would be limited to injury to feelings.

Mr Norman was subsequently awarded £50,926.78 in compensation (in addition to a redundancy payment of £17,130 already received), comprising of:

  • A compensatory award for unfair dismissal, for loss of earnings, of £46,280.63.
  • Compensation for injury to feelings (with interest), of £4,646.15.

The loss of earnings figure above was net of the 50% Polkey reduction.

Key lessons for employers

We have set out below some key take-away points from the Norman v Lidl case, that employers should bear in mind when conducting redundancy processes:

  1. Having a clear redundancy proposal and implementation plan, which is communicated to and understood by the managers involved in the redundancy process, may help achieve a fair outcome. In Norman v Lidl the Tribunal commented that the Respondent had put together a plan for the implementation of redundancy, which was capable of achieving a fair outcome. However, the managers carrying out the process did not fully understand it or what was required of them, and this led to flaws in the process which rendered it unfair. In particular, the managers had “insufficient awareness of their roles and the level of detail required to objectively justify their decision-making”.  They “did not fully understand the nature of the task they were being asked to complete or the degree of analysis it might perhaps be subject to if challenged”. 
  2. In order to be fair, the consultation process must be genuine and should take place before any final decisions are made. In Norman v Lidl the Tribunal found that there was a lack of understanding as to the purpose of consultation and what was required in order for the process to be fair. The consultation process as a whole had been “cursory”. The second consultation meeting was not a consultation meeting at all, because a decision had already been reached, and there should have been further genuine discussion and consultation before that point. 
  3. It is essential that selection criteria are fair, reasonable, and objectively verifiable. In Norman v Lidl the Tribunal commented that the application of the redundancy selection criteria “was at times cursory and not clearly based upon objective evidence”.  It could not, therefore, be said to be reasonable.
  4. And beware of indirectly discriminatory selection criteria! Whilst it is relatively easy to avoid having selection criteria which are overtly, directly discriminatory, it can be harder to identify when criteria may be indirectly discriminatory. Something will be indirectly discriminatory if it is a provision, criterion or practice, that is applied all irrespective of any protected characteristic, but which places individuals with a specific protected characteristic at a particular disadvantage. A common example of this is including sickness absence records in selection criteria, as this may be indirectly discriminatory towards staff with disabilities. In Norman v Lidl, the Tribunal found that the inclusion, in the “knowledge” selection criterion, of having a university degree, was indirectly discriminatory towards older employees (who are less likely to have gone to university than younger employees).  
  5. Keep clear records about the process followed and decision made, whilst also being aware that these may be disclosable if the decision is challenged. The Tribunal described the dismissing managers’ evidence, regarding the rationale behind the scores given to Mr Norman during the selection process, as “problematical”; due to the fact that there was no contemporaneous documentary evidence to support it, and it therefore relied on recollections made some time after the event. The instruction by those running the redundancy process, that notes of any scoring exercise should be destroyed, was “quite surprising” and had “not assisted the Respondent’s witnesses in explaining their scoring to [the] Tribunal”. The reasons given at the final hearing for the scores awarded appeared to be “an after the fact justification”, and evidence as to the significance of a degree or lack of it “was not wholly consistent”. Had there been explanatory notes in the selection matrix of how scores had been awarded and why, it may have been more straightforward for the employer to show that a fair process had been followed in that regard.

If your organisation needs further advice on any of the issues outlined in this article, please get in touch and our team of experienced Employment Lawyers would be happy to help.

The material in this article is provided for guidance and general information only and is not intended to constitute legal or other professional advice upon which you should rely. In particular, the information should not be used as a substitute for a full and proper consultation with a suitably qualified professional. Please do contact the Bates Wells team if you require further information.