Refusal of Suitable Alternative Employment – The Correct Test

In a case on whether or not it was reasonable for an employee at risk of redundancy to refuse an offer of suitable alternative employment (Readman v Devon Primary Care Trust), the Court of Appeal has reaffirmed that the test is a subjective one. In such cases, the Employment Tribunal (ET) must ask whether an employee has unreasonably refused the offer looking at it from their point of view on the basis of the facts as they appeared, or ought reasonably to have appeared, to them at the time the decision was made. A specific judgment is required, not a judgment on whether the decision fell within a reasonable band of responses which a reasonable employee might have made.



Mrs Readman began her career with the NHS in 1976. In 1985, she moved away from a hospital setting and worked in various capacities in Community Nursing, ultimately as a Community Modern Matron for Devon Primary Care Trust (PCT). Following a reorganisation in 2007, this job disappeared and Mrs Readman was at serious risk of redundancy. She was offered the option of three posts, two of which were at a lower grade. The third post, the position of Modern Matron at Teignmouth Hospital, involved no loss of status, but Mrs Readman rejected it on the ground that she had not worked in a hospital setting since 1985 and her career path and qualifications were in Community Nursing. She subsequently accepted work in Canada. Devon PCT refused to give her a redundancy payment because it believed she had unreasonably rejected an offer of suitable alternative employment. Mrs Readman challenged this decision at the ET.



The ET held that whilst the first two posts on offer were not suitable, the offer of the position at Teignmouth Hospital was one of suitable alternative employment and Mrs Readman’s decision to refuse it was unreasonable. She had rejected it without any considered attempt to explore what aspects, if any, of her current job would be lost and what other duties might be required. In addition, the refusal was ‘against her desire to emigrate’ to Canada and to take advantage, if possible, of her redundancy rights and benefits. Devon PCT was therefore entitled not to make a redundancy payment in her case. Mrs Readman appealed.



The Employment Appeal Tribunal (EAT) upheld Mrs Readman’s appeal and substituted a finding that she was entitled to receive a redundancy payment. In its view, the ET had erred in law in failing to address the core reason why Mrs Readman had refused the offer. She had stated clearly that she had no desire to return to work in a hospital setting, yet the ET had failed to consider whether this was a sound and justifiable reason for her rejecting the post. In the EAT’s judgment, in the particular circumstances of the case, the desire not to work in a hospital setting was a reasonable response, providing Mrs Readman with a sound and justifiable reason for turning the offer down. That she may have had in the background a desire to go to Canada and might prefer to have the redundancy money were plainly incidental to the main reason for her refusal, which was clearly stated and repeated on several occasions.



On appeal to the Court of Appeal, two issues arose. The first was whether, as the EAT found, the ET had erred in law in its consideration of whether Mrs Readman had unreasonably refused the offer of employment. If it had, the second issue was whether the EAT was entitled to substitute its own view or whether it should have remitted the case to the ET as the ‘fact-finding’ body.



The Court agreed with the EAT that the ET had erred in law in failing to address directly the question whether it was unreasonable for Mrs Readman to decline the post of Community Modern Matron. Furthermore, the relevance of her emigration plans required further analysis if these were to be found as a reason for her refusal. Also, a person’s desire, if possible, to take advantage of redundancy rights does not necessarily defeat their claim.



As the Court was not able to find that the ET’s decision was ‘plainly and unarguably wrong’ or that the opposite result was ‘plain and obvious’, as the EAT had found, it was necessary to remit the case to the ET for re-examination.



The Court of Appeal also criticised the EAT for ‘distorting’ the test to be used in such cases by importing into its decision the ‘band of reasonable responses’ test that applies to employers in unfair dismissal cases. A specific judgment is what is needed in such cases.