A claim against City of York Council from one of its former corporate directors over a restructure which saw him leave his job has been upheld by an employment tribunal.
The council has been ordered to pay £10,500 to former corporate director of place Neil Ferris for failing to offer him a suitable alternative role while making his post redundant.
Employment Judge Ian Miller stated in his ruling the payout was understood to be a gateway to other entitlements including pension costs which the tribunal heard were worth around £350,000.
A council spokesperson declined to comment on proceedings which remain ongoing. It is considering an appeal.
The Liberal Democrat opposition estimates that the direct financial cost of the case is around half a million pounds, including legal fees spent fighting the case and additional pension liabilities arising from the unlawful dismissal.
The tribunal, heard in Leeds in October, comes after Mr Ferris left the authority in August 2024 following a restructure process which began the previous January.
Mr Ferris had been responsible for major projects including the York Central and Station Gateway schemes along with planning, transport, highways, housing and community safety, among others.
The restructure, which the council said at the time aimed to make it more efficient and agile, would have seen five roles including his post removed.
They would then be replaced with three new roles, which were later joined by a director of city development role which was offered to Mr Ferris.
Council chief operating officer Ian Floyd to the tribunal the role would still have seen Mr Ferris occupy a high-level position working with major partners.
But Mr Ferris claimed in his witness statement the role had been cobbled together once the council became aware of the cost of removing him.
The former director’s 55th birthday fell in July 2024, meaning the council would have had to cover his early retirement costs if he was made redundant afterwards.
The tribunal considered whether Mr Ferris had been denied a statutory redundancy payout because he unreasonably refused the director of city development job.
Judge Miller’s ruling stated they did not know whether there had been a plan or conspiracy to remove the former director from his job.
But the judge added councillors and senior officers overseeing the process would have known that the director of city development role was a demotion.
The ruling also stated the tribunal could not make a decision on whether Mr Ferris had unreasonably refused the role.
It added it had no bearing on the outcome if the alternative job was unsuitable, which the tribunal ruled it was.
The ruling stated: “The claimant was a very senior government officer and his aspirations were to either obtain a chief executive post of another authority or move sideways into a corporate director or equivalent post in another larger authority, he wanted to continue to progress his career.
“It was the claimant’s view that taking the director of city development role would in fact be a step backwards and that it would harm his career.
“Had the claimant been offered a different job that was suitable then we think it likely that the claimant’s conduct throughout the consultation period and his complete disengagement from the process about the proposed job would have made his rejection of the job unreasonable.
“For these reasons the claimant’s claim is successful, and he is entitled to
statutory redundancy payment.”
Cllr Paula Widdowson, deputy leader of the Liberal Democrat Group on City of York Council, said:
“I am deeply disappointed by how Labour have treated Neil Ferris. The Employment Tribunal has been clear that the Council acted unlawfully in this case.
“That decision has already cost York taxpayers around half a million pounds in legal fees and pension costs alone. This was entirely avoidable, and that money should have been going into public services and not wasted defending an unlawful redundancy.
“Residents now deserve honesty. Labour must come clean about the full financial consequences of this case, including the wider exposure the Council now faces as a result of their actions.
“At a time when residents are being told there is no money for libraries, roads, pavements or basic services, it is simply unacceptable for Labour’s leadership to remain silent about an unlawful decision that has already cost the city hundreds of thousands of pounds.”
