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Standard Telephones and Cables Ltd v Yates

Turning down a demotion dressed up as “suitable alternative employment” does not cost you your redundancy pay.

The ruling

“Employee's refusal of the alternative role found reasonable. Entitlement to redundancy pay preserved.”

You do not have to accept a demotion dressed up as suitable alternative employment just to protect your redundancy pay.

  • Whether an alternative role is suitable, and whether your refusal of it was reasonable, are two separate questions. Equal pay does not settle either of them.
  • A genuine loss of status or skill level can make your refusal reasonable, even where the pay matches.
  • You are entitled to a four-week trial period in any alternative role, without losing your right to treat it as unsuitable if it does not work out, under section 138 of the Employment Rights Act 1996.
Read the full case

The situation

A skilled machine operator with ten years in the same specialist role was told her job was redundant. Her employer offered her a different role instead, doing basic assembly work at the same rate of pay. She turned it down. Her employer argued that because the pay was the same, she had unreasonably refused suitable alternative work, and should lose her redundancy pay entirely.

What the tribunal found

The Employment Appeal Tribunal held that suitability and reasonableness are two separate questions. A role can be suitable in general terms and still be reasonable for a specific employee to refuse, because of what it would mean for them: a loss of status, a step down in skill level, or a change that does not fit their circumstances. Equal pay does not automatically make a role suitable.

Full citation

Standard Telephones and Cables Ltd v Yates. [1981] IRLR 21. Employment Appeal Tribunal. 1981.

Last reviewed 11 July 2026