Workplace woes - what is a drivers' place of work?

If you are an employer of drivers or other mobile employees then the Employment Appeal Tribunal (EAT) recently provided useful guidance for employers in establishing an employee’s ‘place of work’ in the context of workplace closure redundancies.

The case – Exol Lubricants v Birch
Mr Birch and Mr Perrin (the claimants) were employed as HGV delivery drivers for Exol Lubricants (Exol) from 2004 to 2005. The claimants’ employment contracts stated that their ‘place of work’ was Exol’s main depot in Wednesbury in the West Midlands, which was where the claimants loaded their lorries every day, received instructions from and reported to.

As the claimants lived in Manchester and could not afford to commute to Wednesbury, Exol allowed the claimants to park their HGVs overnight at a secure parking facility near their homes in Stockport. The Stockport site was previously used as a small depot, but for many years its only purpose was to provide parking for the claimants.

It was Perrin’s evidence that he had requested Stockport as his starting point when he took the job and that he could not afford to commute to Wednesbury. This parking facility was provided at Exol’s cost and the claimants’ working hours included the time spent driving between Stockport and Wednesbury each day.

Exol provided this arrangement for several years and for the entire duration of the claimants’ employment. Although it was not stated to be a term in the claimants’ employment contracts, it had become a contractual term by virtue of common practice.

All of Exol’s other drivers lived locally to Wednesbury and parked their HGVs at the Wednesbury depot overnight.

When it became unaffordable for Exol to continue to provide the parking facility, Exol sought to terminate the arrangement and change the terms and conditions of the claimants’ employment.

The claimants refused to agree to the change and unfortunately a compromise could not be reached.

Exol therefore decided to dismiss the claimants by reason of redundancy.

Exol sought to argue that the claimants’ ‘place of work’ was Stockport and that because Exol had ceased to carry on business at Stockport, its requirement for drivers in Stockport had diminished and a workplace closure had resulted.

The claimants brought claims for unfair dismissal on the grounds that there was no redundancy situation because their ‘place of work’ was Wednesbury, not Stockport.

The decision
The Employment Tribunal (ET) agreed with the claimants and determined that, based on the contract of employment and the employees’ close connection with the Wednesbury depot, their ‘place of work’ was Exol's depot in Wednesbury.

There was no diminution in Exol’s requirements at the Wednesbury depot and the claimants’ jobs had not gone. The claimants’ jobs would have continued if they agreed to commute from their homes to Wednesbury and agency workers were hired when the claimants’ jobs were terminated, presumably to carry out the claimants’ roles. There was therefore no redundancy situation and the claimants had been unfairly dismissed.

The fact that Exol no longer wanted the claimants to store their HGVs at Stockport did not mean that there had been a workplace closure. It was necessary to establish the claimants’  ‘place of work’.

Exol appealed but the EAT upheld the ET’s decision and reasoning.

Guidance for employers
If you employ delivery drivers or other mobile employees and you are considering closing a depot (or other workplace) or changing the current working arrangements, it is important to consider carefully your proposed course of action. It is clear from this case that the termination of a parking arrangement will not by itself amount to a redundancy situation by reason of workplace closure.

In order for redundancy to be a potentially fair reason for dismissal on the grounds of workplace closure, you will first need to determine the employee’s ‘place of work’ . In doing so you should consider:

• The provisions of the employment contract – this can be a good indicator of the employee’s likely workplace and it is therefore helpful to ensure that any working arrangements are properly documented in the employment contract;

• Any connection the employee may have with a depot or head office – the context of each individual employee and their connection with a particular depot or head office must also form part of the assessment where an employee moves regularly between workspaces. In this case, although the claimants were allowed to park at Stockport every day, this was their only connection to Stockport. The claimants had a much stronger connection to Wednesbury where the claimants loaded their lorries every day, received instructions from and reported to.

This case also serves as a useful reminder to carefully consider the real reason for a dismissal. In this particular set of circumstances, the dismissal may have been fair if Exol had detailed the reason for dismissal as ‘some other substantial reason’, rather than redundancy and had followed a process suitable for a business reorganisation or change of terms and conditions. This course of action would have had an added advantage of not requiring a statutory redundancy payment.

Jenny Marley is a solicitor in the employment team at Veale Wasbrough Vizards. jmarley@vwv.co.uk