Fixed term contracts and collective redundancy consultation: University College Union v The University of Stirling
Where employers propose to make 20 or more employees “redundant” within a period of 90 days, they are obliged to engage in collective consultation. In this context, the term “redundant” refers to any dismissal that is for a reason (or reasons) not related to the individual concerned. In this case, the Court of Session considered whether the expiry of fixed term contracts counts towards the threshold triggering collective consultation.
The Employment Tribunal had held that the expiry of a fixed term contract was a dismissal unrelated to the individual concerned and therefore counted towards the threshold for collective consultation. However, both the EAT and the Court of Session disagreed, finding that the expiry of fixed term contracts may count towards the threshold but will not necessarily do so.
Each situation will involve a careful analysis of the reason for the dismissal and whether it was (or all the reasons were) unrelated to the individual concerned. In this case it was found that the individuals had accepted that their employment would come to an end after a certain period of time or upon the occurrence of a certain event, including following a period of maternity cover and after specified external funding ended. The Court of Session decided that this meant that the reason for dismissal did relate to the individual; it was linked to their particular circumstances and decision to accept the work for a specified period of time.
This can be contrasted with the early termination of a fixed term contract because of a reduced need for staff, or a situation where an employer engages employees on fixed term contracts and has a practice of renewing them but departs from this practice when there is diminished work. Here, the dismissal of the fixed term employees is likely to count towards the threshold for collective consultation because the reasons for proposing to dismiss them are unrelated to the individuals concerned.
When contemplating redundancies at a time when fixed term contracts are expiring it will therefore be necessary to consider the particular circumstances of each fixed term employee and the reasons for which the contract is ending in order to assess whether the dismissals will trigger collective consultation obligations.