Sham Redundancy, Workload not Decreased, Bullying & Stress - Settlement Agreement Lawyers - Monaco Solicitors

Sham Redundancy, Workload not Decreased, Bullying & Stress

This without prejudice letter template concerns an employee who is being made redundant when there is no real decrease in his workload. He had previous complained of bullying and harassment and then singled out for redundancy, when in fact his employer wanted to unfairly dismiss him.


[HR manager name]

[Company name]



Without prejudice save as to costs and subject to contract

Re: Mr Smith

Dear Ms Taylor,

We have been instructed on behalf of Mr Smith to write to you on a “without prejudice” basis, in light of the ongoing consultation with a view to his redundancy.  I understand that discussions are underway with a view to resolving the matter by way of a Settlement Agreement, and we are instructed to take up correspondence on Mr Smith’s behalf.

We have considered your draft Settlement Agreement dated 22 December 2014.  The proposed Termination Payment consists of the following sums (Clause 2.1):

  • £4,583.84 as damages for breaching Clause 4 of the Employee’s contract of employment; and
  • £1,919.71 pay as compensation for loss of office, which includes statutory and company enhanced redundancy payments.

It is our position that the Termination Payment offered to our client is wholly inadequate.  It is our view that there is no genuine redundancy situation, that the purported redundancy procedure has been conducted in an unfair way, and that any termination of Mr Smith’s employment in the present circumstances will be an unfair dismissal.

Mr Smith’s employment commenced on 28 November 2011.  He is currently a Team Manager based at your Richmond site.  On 12 September 2014, he was suspended following a “whistleblowing report” by an Oliver Brown, in relation to invoices for your client Whirlpool Corporation.  Lengthy investigations were conducted lasting some three months, during which Mr Smith was fully cooperative.  At the conclusion of those investigations you identified no fault on Mr Smith’s part; rather that failures of the logging-in system and duplications of time-sheets had led to [Company name], clients being invoiced for extra hours.

Mr Smith­ was notified accordingly in a meeting on 16 December 2014, at about 3pm.  Present at the meeting were yourself, Thomas Williams, and Mr Smith; Mr Williams delivered the outcome verbally but you have yet to provide written confirmation of the same. I am given to understand that you are not issuing any letters regarding the outcome of the investigations due to going down the settlement agreement route.  Please be on notice that we will require such outcome letters if the matter is not settled to our satisfaction.  If the information is not provided we will advise Mr Smith to obtain this by way of a Subject Access Request, and it is our intention to make an application to the Employment Tribunal for pre-action disclosure.

At the same time, Mr Smith was informed that the client no longer wanted him working on its account and his role was therefore redundant.  We wish to make it clear that we do not accept that the client required this, and may ask for evidence to be provided in due course.  If this is not forthcoming we intend to obtain it by way of an SAR or application for pre-action disclosure.

Nor do we accept that his role is redundant.  Up to the date of his suspension, Mr Smith performed a range of duties in the course of his employment.  He was responsible for the Float Team which, we accept, has been disbanded since the “whistleblowing” allegation.  However this only accounted for a small proportion of his workload, less than 1 ½ days a week.  The majority of his time was spent managing the Customer Service Team – overlooking team-members and delivering team briefings, organising training, dealing with enquires, assessing targets, delivering quality feedback, coaching, 1-to-1’s etc.  There are no other managers on this team who can match Mr Smith’s training and experience in these functions.

To complete his duties Mr Smith regularly comes into work earlier and leaves later than his contracted hours.  He takes shortened lunch breaks, and regularly deals with work related-enquiries out-of-hours.  He is not paid overtime for any of this extra work.  The time Mr Smith spent on the Float Team can, and properly should, be devoted to better managing the Customer Service Team, or on other projects.  For example he has sponsored a person, George Evans, on the Team Manager Development Program who he should mentor.  There is no one else on that team with the requisite experience to train Mr Evans, who may have to move to different departments to seek mentoring on some of the modules within the Development Program.

Further, before his suspension, discussions were underway between Mr Smith and his manager to moving him towards a more senior position, with a target to work towards getting on the Operations Manager Development Program.  Indeed he had started taking responsibilities consistent with a more senior role, and has performed equivalent tasks on the Float Team. Although that was a work in progress, he is in a strong position to be able to move into that team.  This can be evidenced in his Personal Development Plan (PDP).

As you are no doubt aware, a redundancy situation may arise where the requirements of a business for employees to carry out work of a particular kind have ceased or diminished or are expected to cease or diminish.  For all the reasons detailed above, this is simply not the case in relation to the work done by Mr Smith, the requirement for which does and will continue.

If Mr Smith’s role is genuinely redundant (which we deny) [Company name] has failed to follow a proper, fair and objective redundancy procedure.  You have not correctly identified a pool from which to select employees for redundancy.  More significantly there has been no consultation with Mr Smith and no attempt whatsoever to discuss or identify alternatives to redundancy.  We do not accept that there are no roles that you can redeploy him into at this time.  We query whether you have even considered his PDP at all.  Rather it appears that you have simply chosen to discard Mr Smith as an easy target upon his return from suspension.

It is our position that you have conducted this purported “redundancy” process in a wholly unfair and unlawful way, and any dismissal arising out of it will also be unfair and unlawful.  It is difficult to over-state the stress and humiliation suffered by Mr Smith in recent months which is being compounded by his impending dismissal.  His continued employment has become untenable not due to a genuine redundancy situation but because of your continuing breaches of the mutual duty of trust and confidence.

A further compounding breach of [Company name]’s duty to Mr Smith was your failure to deal with his grievance in July / August 2014.  Mr Smith raised a serious complaint of bullying and harassment by a fellow colleague, Mr Brown, in a meeting with his operational manager Arthur Johnson and Oscar Watson.  This was not fully investigated and no effective action was taken in relation to that grievance; it appears that no actioned outcome was determined or communicated to Mr Smith.  His harasser subsequently went on to make the allegations which have cost Mr Smith, through no fault of his, his good name and his employment.

As a result of these various breaches Mr Smith has suffered psychological injury namely work-related stress and depression.  Following the allegations and during the investigations he suffered from constant anxiety, mood swings, loss of appetite and insomnia.  He had difficulty getting out of bed, he did not want to leave the house, and the relationships with his family and friends have been damaged, perhaps irreparably.  In November 2014, he was diagnosed with clinical depression; he was medicated for this condition which has since been doubled in dose to help him cope.  The effect of the medication is that he becomes lethargic and cannot function in his day-to-day life as he should.  We have yet to obtain an expert medical report and prognosis, but this condition is expected to persist for some months.

Consequently, we can identify a number of causes of action arising out of your conduct towards our client, and will pursue these as appropriate.  However Mr Smith does not wish to resort to litigation and has therefore instructed us, at least at this stage, to aim towards a suitable settlement.

It is our position that the starting point for any such settlement has to be 12 months’ salary.  The job markets are still sluggish, and it will take Mr Smith at least this long to secure equivalent employment.  His job prospects have been further damaged because [Company name]’s conduct – both in relation to this purported redundancy and the disciplinary investigation that preceded it – has resulted in his being diagnosed with work-related stress and depression.

From this starting point the settlement amount should be increased to reflect the loss of benefits and the loss of statutory rights that Mr Smith will suffer as a result of losing his employment.  The settlement should also acknowledge of the legal costs he has already incurred in instructing us to negotiate a proper settlement.  It is our view that such damages would be awarded by any Employment Tribunal, and would be uplifted by 25% for your failure to follow the ACAS Code of Practice on Disciplinary & Grievance Procedures.  We would also seek to recover our legal costs and the costs of issuing proceedings.

We look forward to hearing from you with an appropriately amended Settlement Agreement, in the hope that we can bring this matter to a mutually agreeable and timely conclusion.

Yours sincerely,


[Lawyer’s name]


So, we hope you found this example without prejudice letter template useful. If you would like help drafting your without prejudice letter, or for full legal representation, then get in touch and we will be happy to have a brief initial chat without charge. Either call us on 0800 533 5134, email or click here to book a call with one of our lawyers.