Miss K Symons and Others v Heartlands Trust (In Creditors Voluntary Liquidation): 1400636/2024 and Others
JUDGMENT
The judgment of the Employment Judge sitting alone is that:[1]The complaint that the respondent failed to comply with a requirement of section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 is well founded.[2]The tribunal makes a protective award in respect of the Claimants who were employees of the respondent who were dismissed as redundant on or after 31 January 2024 and orders the respondent to pay those employees remuneration for the protected period of 30 days beginning on 31 January 2024.REASONS
[1]This is a claim for a protective award brought by the following fourteen claimants, who are collectively referred to in this Judgment as “the Claimants”: Miss Kirsty Symons (1400636/2024); Mr David Pearce (1400637/2024); Mrs Alison Buckingham Pearce (1400638/2024); Mr Nathaniel James(1400639/2024); Miss Paxton Holby (1400667/2024); Mr Kieran Williams (1400695/2024); Mrs Claire Springall (1400715/2024); Mr Jordan Hammond (1400720/2024); Miss Kelsey Bell (1401358/2024); Miss Zoe Morrison (1401359/2024); Miss Karen Thorne (1401360/2024); Ms Charlotte Dey (1401361/2024); Mr Kevin Baker (1401362/2024); and Miss Maureen Rolfe (1401363/2024).[2]I have considered the evidence before me, both oral and documentary, and I have considered the legal and factual submissions made by and on behalf of the respective parties. I find the following facts proven on the balance of probabilities.[3]The respondent Heartlands Trust was a registered charity and a private limited company by guarantee. It was a major project based near Pool, Redruth in West Cornwall which was funded by the National Lottery, and which intended to improve life and opportunity for the local community by providing access to playground, green space, leisure, educational, heritage and community group meeting facilities. It operated for approximately 12 years, but funding was withdrawn towards the end of 2023. It entered voluntary creditors liquidation on 11 March 2024. The claimants were all employed at its premises in Pool.[4]On 5 January 2024 Cornwall Council issued a press release to the effect that funding options had been exhausted and that “facilities at the site will have to close”. There was also a meeting on 5 January 2024 between one of the respondent’s Trustees, namely Mr Sillifant, and the respondent’s employees, including all of the Claimants, at which the Claimants were informed that the respondent might have to cease trading, but without confirming any definite closure date. Mr Sillifant then sent an email letter dated 17 January 2024 to the effect that “it is sadly proposed the Heartlands Trust will cease to operate from 31 January 2024”. This letter suggested that the Claimants’ employment was at risk of redundancy but that negotiations were underway with Cornwall Council to the effect that their employment might transfer under the TUPE Regulations to the Council. The letter referred to collective consultation and the right to elect employee representatives but concluded “sadly due to unforeseen circumstances we are unable to comply with this due to time constraints and we are going to look to consult with you as groups and as individuals as soon as possible”. That letter did not give formal notice of termination of employment to any of the Claimants.[5]In a subsequent letter to all staff dated 19 January 2024 Mr Sillifant referred again to a possible TUPE transfer and/or collective redundancy consultation, but he confirmed “we have been advised by the Council that the Trust must close on 31 January 2024 and [as] we have been granted no extensions we do not believe sadly that we have time in which to follow this process.” Under the heading “collective redundancy” that letter went on to explain that 23 employees were affected, that there was going to be a business closure, and that normally there should be 30 days as a period of collective consultation but “we believe special circumstances apply which means we are unable to comply with this duty”. That letter did not give formal notice of termination of the Claimants’ employment (and indeed it continued to suggest that their employment might transfer to the Council).[6]Mr Sillifant held a further meeting with the respondent’s employees, including the Claimants, on 22 January 2024. The Claimants were still not given any formal notice of the termination of their employment. The primary focus of this meeting was the possibility of a TUPE transfer of the employment of all employees (including the Claimants) to the Council. In the event there was no such transfer.[7]There was no further consultation. The respondent did not take steps to elect employee representatives. The Claimants were paid up to and including 31 January 2024 and the respondent closed its premises on that day. I find that their employment terminated with effect from 31 January 2024 in the absence of any formal notice of termination of employment. The Claimants were among the 26 employees of the respondent who were all dismissed by reason of redundancy on that date without formal notice.[8]There was no independent trade union which was recognised by the respondent for the purposes of collective bargaining, consultation and negotiation. There were no employee representatives, and the respondent failed to make arrangements to elect any employee representatives. The respondent failed to undertake any adequate consultation with the Claimants prior to the dismissals.[9]Having found the above facts, I now apply the law.[10]The relevant law is in the Trade Union and Labour Relations (Consultation) Act 1992 (“TULRCA”).[11]Section 188(1) of TULRCA provides as follows: “Where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less, the employer shall consult about the dismissals all the persons who are appropriate representatives of any of the employees who may be affected by the proposed dismissals or may be affected by measures taken in connection with those dismissals”. S188(1A) provides that "The consultation shall begin in good time and in any event –(a) where the employer is proposing to dismiss 100 or more employees as mentioned in subsection (1), at least 90 days, and(b) otherwise, at least 30 days, before the first of the dismissals takes effect.[12]S 188(1B) provides that: “For the purposes of this section the appropriate representatives of any affected employees are –(a) if the employees of a description in respect of which an independent trade union is recognised by their employer, representatives of the trade union, or(b) in any other case, whichever of the following employee representatives the employer chooses:- (i) employee representatives appointed or elected by the affected employees otherwise than for the purposes of this section who (having regard to the purposes for and the method by which they were appointed or elected) have authority from those employees to receive information and to be consulted about the proposed dismissals on their behalf; (ii) employee representatives elected by the affected employees, for the purposes of this section, in an election satisfying the requirements of section 188A(1).”[13]S 188(2): provides that; “The consultation shall include consultation about ways of –(a) avoiding the dismissals,(b) reducing the numbers of employees to be dismissed, and(c) mitigating the consequences of the dismissals, and shall be undertaken by the employer with a view to reaching agreement with the appropriate representatives.”[14]Section 188(4) provides: “For the purposes of the consultation the employer shall disclose in writing to the appropriate representatives –(a) the reasons for his proposals,(b) the numbers and descriptions of employees whom it is proposed to dismiss as redundant,(c) the total number of employees of any such description employed by the employer at the establishment in question,(d) the proposed method of selecting the employees who may be dismissed,(e) the proposed method of carrying out the dismissals, with due regard to any agreed procedure, including the period over which any dismissals are to take effect,(f) the proposed method of calculating the amount of any redundancy payments to be made (otherwise than in compliance with the obligation imposed by or by virtue of any enactment) to employees who may be dismissed,(g) the number of agency workers working temporarily for and under the supervision and direction of the employer,(h) the parts of the employer's undertaking in which those agency workers are working, and(i) the type of work are those agency workers are carrying out.”[15]Section 188(5) provides: “That information shall be given to each of the appropriate representatives by being delivered to them, or sent by post to an address notified by them to the employer, or in the case of representatives of a trade union sent by post to the union at the address of its head or main office.”[16]In this case there was no independent trade union which was recognised by the respondent for the purposes of collective bargaining, consultation and negotiation. There were no employee representatives, and the respondent failed to make arrangements to elect any employee representatives. The respondent was clearly aware of its collective consultation requirements. It provided some outline information but then failed to elect employee representatives and also failed to consult individually during the 30 days’ consultation period. I reject the assertion that “special circumstances” precluded the respondent from commencing the process of electing representatives and/or undertaking meaningful collective consultation after 17 January 2024. I find that the respondent failed to undertake any adequate consultation with the Claimants prior to their dismissals.[17]The claimant’s claims are well-founded, and I make the protective award set out above, for the protected period of 30 days. Employment Judge N J Roper Dated 29 November 2024 Judgment sent to Parties on 07 January 2025 By Mr J McCormick ANNEX TO THE JUDGMENT (PROTECTIVE AWARDS) Recoupment of Jobseeker’s Allowance, income-related Employment and Support Allowance and Income Support The following particulars are given pursuant to the Employment Protection (Recoupment of Jobseekers Allowance and Income Support) Regulations 1996, SI 1996 No 2349, Regulation 5(2)(b), SI 2010 No 2429 Reg.5. The respondent is under a duty to give the Secretary of State the following information in writing:(a) the name, address and National Insurance number of every employee to whom the protective award relates; and(b) the date of termination (or proposed termination) of the employment of each such employee. That information shall be given within 10 days, commencing on the day on which the Tribunal announced its judgment at the hearing. If the Tribunal did not announce its judgment at the hearing, the information shall be given within the period of 10 days, commencing on the day on which the relevant judgment was respondent to do so within those times, then the information shall be given as soon as reasonably practicable thereafter. No part of the remuneration due to an employee under the protective award is payable until either (a) the Secretary of State has served a notice (called a Recoupment Notice) on the respondent to pay the whole or part thereof to the Secretary of State or (b) the Secretary of State has notified the respondent in writing that no such notice is to be served. This is without prejudice to the right of an employee to present a complaint to an Employment Tribunal of the employer’s failure to pay remuneration under a protective award. If the Secretary of State has served a Recoupment Notice on the respondent, the sum claimed in the Recoupment Notice in relation to each employee will be whichever is the lesser of: (i) the amount (less any tax or social security contributions which fall to be deducted therefrom by the employer) accrued due to the employee in respect of so much of the protected period as falls before the date on which the Secretary of State receives from the employer the information referred to above; OR (ii) the amount paid by way of or paid as on account of Jobseeker’s Allowance, income-related Employment and Support Allowance or Income Support to the employee for any period which coincides with any part of the protective period falling before the date described in (i) above. The sum claimed in the Recoupment Notice will be payable forthwith to the Secretary of State. The balance of the remuneration under the protective award is then payable to the employee, subject to the deduction of any tax or social security contributions. A Recoupment Notice must be served within the period of 21 days after the Secretary of State has received from the respondent the above-mentioned information required to be given by the respondent to the Secretary of State or as soon as practicable thereafter. After paying the balance of the remuneration (less tax and social security contributions) to the employee, the respondent will not be further liable to the employee. However, the sum claimed in a Recoupment Notice is due from the respondent as a debt to the Secretary of State, whatever may have been paid to the employee, and regardless of any dispute between the employee and the Secretary of State as to the amount specified in the Recoupment Notice.[1]The claimant has insufficient continuity of service to pursue claims for entitlement to a statutory redundancy payment and for unfair dismissal, and these claims are dismissed on withdrawal by the claimant; and[2]The claimant was dismissed without notice on 31 January 2024. The claimant’s claim for breach of contract is well founded and the respondent is ordered to pay the claimant two months’ notice pay in the net sum of £1,672.60. (The claimant gives credit for the sum of £1,383.40 already received against this sum); and[3]The claimant’s claim for accrued but unpaid holiday pay is dismissed on withdrawal by the claimant.