Potential Constructive Dismissal?

woodsy21

Hi,

I work in a finance department as an accountant, and get involved in planning and analysis.

I know our company is struggling at the moment, and have been making headcount reductions even before the credit crunch. As our revenue forecast is down again next year, we are looking at taking even more heads out of the company.

I came across a file relating to our plan for next year. There are two of us that do the same job. I earn £40,200 per year and my collegue earns £40,000. I could see the file which shows a reduction in our monthly salary costs in our finance team from £9,866 to £6,516 which is by £3350 per month, which equates to £40,200 per year. This drop is between March and April next year.

So it looks to me as though I am planned to go next year - The file links to her local drive on her PC rather than the network so I can't see if my name is in there?

I thought about it, and she would probably get the job following the consultancy process as she is more experienced and skilled than myself. However, could I potentially use this as a case for constructive dismissal if it happens to myself rather than her in March?

I thought about what figure should be planned? - and maybe that as I earn slightly more than her it's down to prudence. However, if it was prudence surely they should plan to keep the higher salaried person in the plan?

The only thing I can think of that they could use as a reason is that it would be more costly to make me redundant as I have been there a few years longer, so it's my salary they planned to take out, (being prudent). However, we are a big corporate company and any redundancy generally would come from the corporate pot and not impact our small legal entity.

This is for example if we had to make someone redundant and pay them 100k we may not actually do it and contine with their employment because it would be too costly to dispose of them. This pot is available to ensure we make the correct decision for the business going forward and actually make the person redundant.

So the redundancy package shouldn't really impact what decision to plan at.

Should they have planned a weighted figure?

The consultation has not taken place yet.

Where do you think I stand on this issue?
What actions do you think I should take?

Regards

Steve

nomoneytoday

How is it constructive dismissal?

An extreme example would be if they changed your job title to floor vacuumer, and cut your salary to 50p an hour.

Bean_Counter

Hi Steve,

As a fellow accountant, I prepare forecasts and budgets. When doing sensitivity analysis, I also look at what level of overheads could be supported by a reduced margin. In these exercises it is often easier to think that we need to lose a salaary of £x and then take a suitable person out of the salary calculation, purely for the sake of the illustration. Hence they might be thinking that they need to lose someone of roughly your cost.

If the worst does come to the worst there will be opportunity to be involved in the process, appeal any decisions. But if it were me (and I know it easy for me to say), I would try not to worry too much for the moment and cross that bridge when you come to it.

I would doubt you would have a case for constructive dismissal, but that would really depend on how they handled any redundancy process.

Out of interest, how did you come across this file?

woodsy21

I think it could be constructive dismissal as it looks potentially like they have already made their mind up on who will keep their job and who will go. Surely, this is wrong - I thought that once they announce that one of the two jobs are going that they need to give both people the opportunity to apply for the role, and make their decision over the consultation period which is usually a month - as two roles become one we should both be put on consultation and given the chance to keep the role - They shouldn't have pre-decided on who will be made redundant before this period?

woodsy21

Hi Bean Counter,

Both myself and my collegue plan these with the relevent directors. My collegue did it this planning session and I have done it in previous sessions. There are only three people in my department, and two of us do the same role. We lose several million a year and have pulled a revenue forecast for next year of about a 20% drop. We can't sustain the number of staff we have so the MD will just go to each of the department directors and say I need x number of heads out of your team. My finance director would have said right it's either me or my collegue. I earn 40.2k and she earns 40k - why have they planned my exact salary to be taken out, rather than a blended average? - If it's pre-determined that it's me then surely this is against employment law to have decided before the consultation period?

Steve

Tozer

woodsy21 wrote: »

I think it could be constructive dismissal as it looks potentially like they have already made their mind up on who will keep their job and who will go. Surely, this is wrong - I thought that once they announce that one of the two jobs are going that they need to give both people the opportunity to apply for the role, and make their decision over the consultation period which is usually a month - as two roles become one we should both be put on consultation and given the chance to keep the role - They shouldn't have pre-decided on who will be made redundant before this period?

Not correct.

It is not constructive dismissal. It may, however, be evidence of unfair selection for redundancy. However, it shows a plan - not conclusive (together with the fact that you have made a few assumptions) that it will happen.

tinkerbell84

If you earn £40.2k, the costs to the company would be closer to £60k per annum, so maybe you're reading too much into this?

Conor_3

woodsy21 wrote: »

What actions do you think I should take?

Regards

Steve

None because you would have to reveal how you got the information and that was on a local file on the colleagues PC. Under pretty much every companies IT rules, you will have been guilty of gross misconduct and would most likely be dismissed forthwith without any notice period and definitely kissing goodbye to any chance of redundancy pay.

SomeBozo

This is not constructive dismissal.

This is the company planning and looking at options for the future.

Bozo

pinkshoes

woodsy21 wrote: »

I thought about it, and she would probably get the job following the consultancy process as she is more experienced and skilled than myself.

So you earn more than her, but she's more experienced and skilled?

I don't see how it's constructive dismissal when it's important for companies to make plans. Perhaps they just picked the highest department salary as an example of how much money could potentially be saved?

Just keep your head down, work hard, and prove yourself to be a better worker than your colleague.

ceridwen

Uh?!!! Well - from what you say - the words "constructive dismissal" dont exactly spring to mind....you'd best just hang on in there and wait to see what happens (meanwhile making financial plans for if the worst comes to the worst).

My understanding of "constructive dismissal" is if the firm makes it unbearable for you to continue in the job - errrr....I dont think finding out they have been writing out possible redundancy plans for someone (yourself or otherwise) would count as that in anyone's book.

Even if I were to come across paper plans and with my name written on the top of them - I wouldnt regard that as being a "constructive dismissal" possibility.

I woulda thought the type of thing that would count for this is someone who works standard office hours being told to work shift work for instance/someone who lives a very short distance from their job being told to spend lots of time commuting per day/someone with known "ethics" about what jobs they will and wont do being told to do something that goes against their conscience ....that sorta thing.

Sorry - it doesnt look to me like you have the proverbial "leg to stand on" in this respect.

I can understand you being upset.....please try and stay as calm as you can....and wait and see...