The two questions to be posed when determining whether a redundancy situation has arisen were addressed in the House of Lords in Murray and anor v Foyle Meats [1991].

Firstly, have the requirements of the business for employees to carry out work of a particular kind diminished or ceased; and secondly, if so, is the dismissal in question attributable, wholly or mainly, to that fact?

Employment tribunals can still occasionally become confused as to the extent to which their focus should be on diminution in the need for employees or diminution in the quantity of work to be performed.

Mr Justice Burton confirmed in Kingwell and ors v Elizabeth Bradley Designs that a redundancy "does not only arise where there is a poor financial situation"; it can "occur where there is a successful employer with plenty of work, but who, sensibly as far as commerce and economics is concerned, decides to reorganise his business because he concludes that he is overstaffed".

It is a long-established principle that an employment tribunal has no jurisdiction to investigate the employer's reasons for redundancies.

It is not relevant whether the tribunal considers the reason for redundancy to be sound; rather whether the respondent's management thinks, on reasonable grounds, that it is sound.

In the recent case of Scott v Richardson, Mr Richardson was dismissed following his refusal to accept a change in his terms and conditions of employment.

The Employment Appeals Tribunal (EAT) held the tribunal erred in expressing its own view as to the employer's commercial decision leading to the business reorganisation, rather than addressing its reasons.

The tribunal had held that the employer had to "demonstrate that [the re-organisation] had discernible advantages" and that it was not enough for the employer to state simply that the re-organisation was a substantial reason for the dismissal.

The correct approach is, as the EAT helpfully confirmed, to assess whether the employer reasonably believed that the change to the contract had commercial advantages; the employer did not have to prove that it was the case.

The employer had only to show that its reason was not "whimsical, unworthy or trivial".

In Leventhal v North [2005] a redundancy dismissal was found to be unfair because the employer failed to consider 'bumping', even though the other job was a subordinate role with less pay and the redundant employee had suggested he would not consider it.

The EAT's rejection of the employer's appeal does not mean that bumping must always be considered, only that the tribunal was entitled to reach that decision in the particular circumstances.

Employers should therefore consider the existence of other vacancies; how different the jobs are (including pay difference); the relative length of service of the two employees and the qualifications of the original employee at risk.

The employee should also be asked whether he/ she would consider subordinate roles which are vacant or to which he/she could be bumped.

In addition, if an employee is unwilling to accept voluntary redundancy and is subsequently dismissed, it now seems certain, in light of the Murray decision, that his/her dismissal could be justified on grounds of redundancy.

The EAT decision in Church v West Lancashire NHS Trust [1999], to the effect that a bumping redundancy was not "wholly or mainly attributable to the diminution in requirements for employees to do work of a particular kind, but rather to the method (i.e. bumping) by which the employers sought to manage a redundancy situation", can now apparently be ignored.

Some commentators, relying on the EAT decision in Heathmill Multimedia ASP v Jones and anor [2003] have stated that redundancy consultation meetings are not disciplinary hearings (notwithstanding the new statutory dispute resolution procedures), because it is not envisaged that disciplinary action will result (as required by section 13(4) of the Employment Relations Act 1999 (ERelA)).

However, this appears to ignore the clear wording of the Employment Act (ED) 2002, which confirms that a meeting held for the purposes of schedule 2 of the EA 2002 is also a hearing for the purposes of section 13(4) and (5) of the ERelA (the provisions that define a disciplinary hearing and grievance hearing).

An employer will therefore be well advised to cater for accompanied meetings in any redundancy process.

It is now clear that an employer's obligation in respect of alternative employment is not discharged by alerting the potentially redundant employee to the possibility of alternative positions.

Sufficient information must be provided to enable the employee to make a meaningful decision.

In Fisher v Hoopoe Finance, Mr Fisher was at risk of redundancy.

His employer drew his attention to an alternative vacancy but did not provide him with the financial details of that role, and Mr Fisher decided not to pursue it.

Following his redundancy, Mr Fisher argued that this omission by his employer rendered his dismissal unfair.

The EAT agreed with Mr Fisher and, consequently, for larger organisations, this decision presents problems.

Employers often take a two-step approach to alternative employment for good practical reasons; firstly, they will provide a list of possible vacancies (perhaps with limited substantive information); and secondly, only when the employee has expressed an initial preference, will they then start to provide fuller contractual information, arrange interviews, and so on.

This seemingly sensible approach is now open to criticism.

Finally, the European Court of Justice (ECJ) has recently handed down its decision in Junk v Wolfgang Kuhnel regarding employers' consultation obligations in a collective redundancy situation.

The applicable European Union directive states that these obligations should be complied with before redundancies are effected, but leaves the term 'redundancy' undefined.

The ECJ was left to debate whether 'redundancy' meant the actual giving of notice or the expiry of the period of notice given.

Their decision would also affect whether employers in the UK could continue to give individual notices of termination during the timeframe for collective consultation laid down by section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULR(C)A) or only after the relevant time-frame has expired.

Both the Directive and TULR(C)A provide that collective consultation must begin in "good time". However, only TULR(C)A provides that, where the employer is proposing to dismiss 100 or more employees within a period of 90 days or less, consultation must begin at least 90 days before the first employee dismissals take effect; and otherwise, at least 30 days before the first employee dismissals take effect.

TULR(C)A does not state that consultation must continue for the 30/90 day period, only that no dismissals should take effect within the 30/90 day period.

The ECJ concluded that a 'redundancy' takes effect when notice is given (rather than when it expires) and that under the applicable directive, consultation must be concluded before notice is given.

UK employment tribunals will probably treat this decision as authority that employers should not give notice of termination until the 30/90 day periods have expired.

If so, this will constitute a significant shift from the previously accepted position.

It will also certainly make collective redundancy exercises more expensive for employers since they will have to wait until the end of the 30/90 day period before they can give notice or pay in lieu of notice, even if consultation has been concluded some time earlier.

Over recent years, the focus has arguably shifted from issues concerning the substantive fairness of redundancy dismissals to the finer points of procedure.

It will be interesting to see whether this trend continues as case law relating to the statutory dispute resolution procedures starts to multiply.

Christopher Walter and Ray Wann respectively chair the European and UK employment law practices of Paul Hastings Janofsky & Walker.