Legal expert Emma Naughton reports on a recent EAT ruling that highlights the importance of reasonableness

When considering relocating its business, or part of it, an employer may often assume that its employees will move with it, based on there being an express mobility clause within the employment contract. After all, the employee has expressly agreed to this – right? However, whether or not the mobility clause can be relied on in reality will hinge on reasonableness.

The recent Employment Appeal Tribunal (EAT) decision in Kellogg Brown & Root (UK) Ltd v (1) Fitton and (2) Ewer examined reasonableness in more detail.

Kellogg Brown & Root operated two sites in the UK – one in Greenford and one in Leatherhead (more than 30 miles apart). The claimants worked at Greenford.

In April 2015, Root announced that it would be closing its Greenford site at the end of June 2015, with all employees transferring to Leatherhead on 1 July 2015. Root sought to rely on a mobility clause within the claimants' employment contracts, which stated: "The location of your employment is… but the company may require you to work at a different location including any new office location of the company either in the UK or overseas either on a temporary or permanent basis. You agree to comply with this requirement unless exceptional circumstances prevail."

Mr Fitton had bought a flat in Harrow (near Greenford) in November 2005 and could either walk or get the underground to work in around 20 minutes. He was able to drive but did not have a car. He raised objection to the fact that the site move would necessitate a two-hour commute for him. Mr Ewer, who had been employed by Root for 25 years and was turning 64 years of age, similarly objected to the increased travel time.

Root confirmed that a test of reasonableness would be applied by a tribunal. It believed that this test was satisfied for the following reasons:

  • Leatherhead was within the range of the mobility clause.

  • Root was consulting collectively and individually about measures being put in place to assist.

  • The move was a direct result of an office closure to ensure Root's future business in challenging times. The company was making a contribution to help offset the travel costs of longer journeys to all affected individuals for a period of six months.

  • Root was offering flexible working opportunities wherever it could to lessen the travel burden.

  • Root was reducing its core times to allow employees with longer journeys to finish earlier.

The claimants maintained that there was a workplace redundancy situation and they were entitled to redundancy payments. Root disagreed, arguing that their roles were simply being transferred in accordance with the mobility clause. When the claimants failed to attend the Leatherhead site, they were dismissed for failure to obey a lawful instruction of the company. The claimants brought claims of unfair dismissal and for statutory redundancy payments.  

While the EAT disagreed with the tribunal's decision regarding whether the claimants were entitled to redundancy payments, it agreed with the tribunal that the dismissals were unfair. The mobility clause relied upon was too wide and uncertain; it had been unreasonably invoked by Root and, as a result, the claimants had acted reasonably in refusing to comply with the instruction to work at Leatherhead.  

The lesson for employers to take away from this is certainly not that mobility clauses are unenforceable and so there is no merit in including them within an employment contract. Quite the opposite – an express mobility clause is extremely important should an employer wish to have some degree of flexibility in relocation. However, the mobility clause needs to be reasonable, well drafted and well thought out if it is going to be enforceable. Since reasonableness will have a subjective element, each case will turn on its own facts.   

Emma Naughton is an associate in the employment team at Dentons