Investment director made redundant after team closure: tribunal upholds fair process
A commercial development director was fairly dismissed when his team was disbanded, despite a misleading statement by a managing director. The tribunal found a genuine redundancy situation and a fair consultation process.
1 min read · Last updated 18 May 2026
Case details
- #redundancy-situation
- #investment-management-team-closure
- #consultation-process
- #band-of-reasonable-responses
- #misleading-statement
Key facts
- The claimant was employed as Commercial Development Director, principally leading the Investment Management Team.
- The Investment Management Team was disbanded due to financial concerns, reducing the need for the claimant's role.
- The respondent followed a redundancy consultation process from 10 February to 16 March 2022.
- The managing director made a misleading statement about the reason for redundancy, but the true reason was the closure of the investment management function.
- The tribunal found the dismissal was by reason of redundancy and the process was fair.
Timeline
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Board meeting
Board minutes show compliance reporting by Mr Amore, HR by Ms Booth, and investment management reporting by the claimant.
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Board meeting
Concerns about financial performance of Investment Management Unit noted. Compliance by Mr Amore, HR handover from Ms Booth to Sonia Oosthuizen.
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Board meeting
Compliance report by Mr Amore; no material contributions from claimant. Investment management profitability still a concern.
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Claimant put at risk of redundancy
Formal notice of proposed redundancy given to claimant.
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First consultation meeting
Mr Jones told claimant that a prospective buyer did not want him; later clarified by Mr Posgate that redundancy was due to closure of investment management team.
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Second consultation meeting
Further consultation; followed up with letter on 10 March 2022.
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Final consultation meeting
Redundancy confirmed on 16 March 2022.
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Hearing day 1
Employment tribunal hearing at Reading by CVP.
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Hearing day 2
Employment tribunal hearing concluded.
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Judgment issued
Claim of unfair dismissal dismissed.
The legal issue
The tribunal had to decide whether there was a genuine redundancy situation and whether the employer followed a fair procedure, including adequate consultation and warning.
The outcome
The tribunal dismissed the claim of unfair dismissal.
The key reasons were:
- The core part of the claimant's role was leading the Investment Management Team, which was disbanded due to financial concerns.
- Although the managing director made a misleading statement about the reason for redundancy, the true reason was the closure of the investment management function.
- The respondent followed a consultation process from 10 February to 16 March 2022, which the tribunal considered fair.
No compensation was awarded as the claim was dismissed.
Lessons & takeaways
- Employers should ensure that the reason for redundancy is clearly documented and communicated to avoid confusion or allegations of deceit.
- A misleading statement by a manager does not automatically make a dismissal unfair if the underlying reason is genuine and the process is fair.
- Employees should focus on the core duties of their role when arguing that a redundancy situation does not exist; peripheral duties may not prevent a genuine redundancy.
- A fair consultation process, even if relatively short, can be sufficient if it is meaningful and the employee has the opportunity to make representations.
What this case shows in practice
This case illustrates how a redundancy dismissal can be upheld even when a manager makes a misleading statement about the reason. The claimant, a Commercial Development Director, was told by the managing director that a prospective buyer did not want him. However, the true reason was the closure of the investment management team, which formed the core of his role. The tribunal accepted that the misleading statement did not undermine the genuine redundancy situation.
What the employer could have done differently
The employer could have avoided confusion by ensuring that all managers gave consistent and accurate information from the outset. The managing director's misleading statement gave the claimant grounds to suspect unfairness. However, the employer's overall process, including consultation meetings and written communications, was found to be fair. The tribunal noted that the claimant was given adequate warning and opportunities to respond.
Why the result matters
This decision reinforces that tribunals will look at the substance of a redundancy situation rather than isolated comments. Employees challenging a redundancy should focus on whether the role has genuinely diminished, not just on peripheral duties. For employers, the case highlights the importance of a clear and documented consultation process, even if the decision to close a team is already made.
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