Is refusal to relocate misconduct?

Normally, dismissing an employee because they don’t wish to relocate is a redundancy dismissal, even though their role is still available at the new workplace. This is because the dismissal is attributable to the fact that you are ceasing to carry on the business in the place where the employee is currently employed, and that satisfies the statutory definition of redundancy. So, you would seek express consent from those who are willing to relocate and then commence a redundancy process in the normal way for those who aren’t. Collective consultation obligations may also apply depending on the numbers involved.

However, there’s one important exception: if you implement the relocation by invoking a mobility clause in the employee’s contract and then they refuse to relocate, your potentially fair reason for dismissal can be misconduct rather than redundancy. If you are going to invoke a mobility clause, take this decision at the outset, make your position clear and act consistently throughout. Note also that if you are only relocating a very short distance, such as within the same small town, you may be able to rely on an implied mobility clause.

If you are going to rely on a contractual mobility clause, the wording of it must be clear, specific and unambiguous, it must be drafted no wider than is necessary and you must comply with the implied duty of trust and confidence in how you implement the relocation (meaning you need to consult with the employee, act reasonably throughout and give adequate notice of relocation). Ensure you also have good business grounds for making a significant relocation decision and look at effective ways of mitigating the impact of relocation on staff, e.g. by offering relocation expenses. Finally, there’s still a risk of an indirect sex discrimination claim - it’s likely to be more difficult for women than men to relocate because a greater proportion of women, compared with men, are not the main wage earners. If it is indirectly discriminatory, you would need to be able to objectively justify the relocation.