GMB Union v Everest 2020 Ltd (in administration) and Secretary of State for Business and Trade: 1603777/2024 and Others
EMPLOYMENT TRIBUNALS
Case No 1603777/2024
Between
GMB UnionClaimantEverest 2020 Ltd (in administration) and Secretary of State for Business and TradeRespondent
Before
Employment Judge S JenkinsMs C Jones (instructed by Counsel) for claimantNot represented for respondentDate 19 June 2025
JUDGMENT
[1]The Claimant’s complaint, under section 189 of the Trade Union and Labour Relations (Consolidation) Act 1992 (“Act”), of a failure by the First Respondent to comply with the requirements of section 188 of the Act, is well-founded.[2]The First Respondent is ordered to pay to the respective individuals listed in Appendix 1, all of whom were dismissed by reason of redundancy, a payment equivalent to remuneration for the protected period of 90 days beginning on 29 April 2024.[3]The Employment Protection (Recoupment of Benefits) Regulations 1996 apply.
REASONS
[1]The hearing was to consider the Claimant’s claim for protective awards, pursuant to section 189 of the Trade Union and Labour Relations (Consolidation) Act 1992 (“Act”), on the basis that the First Respondent had failed to comply with its duty, under section 188 of the Act, to consult appropriate representatives of employees dismissed by reason of redundancy.[2]The Claimant was an independent trade union recognised by the First Respondent in respect of its hourly-paid employees at its site at Treherbert up to April and May 2024, when those employees were dismissed by reason of redundancy, shortly after the First Respondent entered into administration.[3]Initially, former employees themselves, either individually or in groups, brought claims against the First Respondent, joining in the Second Respondent on the basis that he would be responsible for certain payments under Part XII of the Employment Rights Act 1996. However, on realisation that a trade union had been recognised by the First Respondent in respect of those employees, an application was made to substitute the Claimant for those individuals. Employment Judge Povey then ordered, on 21 February 2025, that the Claimant be substituted for the individuals who had brought claims.[4]The First Respondent submitted a response to the claim, which was struck out by Employment Judge Sharp on 3 February 2025 on the basis that it had not been actively pursued. The Second Respondent, the Secretary of State, provided a response on 29 August 2024, noting that the Secretary of State neither supported nor resisted the claims, but requesting that the Tribunal ensure that the individuals were eligible to bring their claims.[5]This hearing was then scheduled to consider the claim. I considered the evidence contained in written witness statements from two of the former employees, Ian Smith and Andrew Howells, and took further evidence from Mr Smith by way of oral answers to questions from me. I also considered the documents in a hearing bundle relevant to the issues I had to determine. Issues and Law[6]Section 188(1) of the Act, 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 dismissal 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.”[7]A number of constituent elements therefore arise in relation to the duties under section 188 of the Act. There must be an employer, who proposes to dismiss employees as redundant, and it seemed clear that, in this case, there was such an employer, the First Respondent, which proposed to dismiss, and indeed largely immediately thereafter did dismiss, employees as redundant.[8]In such circumstances, the employer is under a duty to consult about those dismissals with appropriate representatives. Section 188(1B) provides that, if there is a recognised trade union, then it will be the appropriate representative. If there is no recognised trade union, then the obligation is to consult with employee representatives appointed or elected for that purpose, or, if not elected or appointed for that purpose, having authority from the relevant employees to receive information and to be consulted about the proposed dismissals on their behalf. In this case it was contended that the Claimant was a trade union recognised by the First Respondent, and I therefore needed to consider whether that had been the case.[9]The requirement set out in section 188 only arises where an employer proposes to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less. I therefore needed to be satisfied that that had been the case.[10]Where the duty to consult arises, section 188(1A) provides that the consultation shall begin “in good time” and, in any event, where the employer is proposing to dismiss 100 or more employees, at least 45 days, and otherwise, 30 days, before the first of the dismissals takes effect.[11]Section 188(7) of the Act allow a "special circumstances" defence to a claim of failure to consult, as it provides that, “if, in any case, there are special circumstances which render it not reasonably practicable for the employer to comply with [any of its obligations], then the employer is to take all such steps towards compliance as are reasonably practicable in those circumstances”.[12]In Clarks of Hove Ltd v Bakers’ Union [1978] ICR 1076, the Court of Appeal held that a ‘special circumstance’ must be something ‘exceptional’, ‘out of the ordinary’ or ‘uncommon’. It also pointed out that insolvency is not on its own a special circumstance. Far from being ‘exceptional’ or ‘out of the ordinary’, insolvency is in fact a fairly common occurrence.[13]Finally, if I was satisfied that the First Respondent had proposed to dismiss as redundant 20 or more employees at one establishment within a period of 90 days, I needed to be satisfied as to whether there had then been a failure to comply with the consultation obligation, and, if so, as to the extent of that failure.[14]Section 189(2) of the Act provides that if the Tribunal finds a complaint of failure to consult well-founded, it shall make a declaration to that effect, and can make a protective award. Sections 189(3) and (4) then provide that a protective award is an award ordering the employer to pay remuneration for a protected period, which begins with the date on which the first of the dismissals to which the complaint relates takes effect or the date of the award, whichever is the earlier, and is of such length as the Tribunal determines to be just and equitable in all the circumstances having regard to the seriousness of the employer's default in complying with any requirement of section 188. It cannot however exceed 90 days.[15]The Court of Appeal, in Susie Radin Ltd v GMB and ors [2004] ICR 893, provided guidance as to how a tribunal should approach the assessment of a protected period. It noted five factors that Tribunals should have in mind when applying section 189, as follows:• The purpose of the award is to provide a sanction, not compensation.• The tribunal has a wide discretion to do what it considers just and equitable, but the focus must be on the seriousness of the employer’s default.• The default may vary in seriousness from the technical to a complete failure, both to provide the required information and to consult.• The deliberateness of the failure may be relevant, as may the availability to the employer of legal advice about its obligations under S.188.• How the tribunal assesses the length of the protected period is a matter for the tribunal, but a proper approach where there has been no consultation is to start with the maximum period of 90 days and reduce it only if there are mitigating circumstances justifying a reduction to an extent to which the tribunal considers appropriate.
Findings
[16]The First Respondent was a manufacturing company, based in Treherbert, Rhondda Cynon Taf. At the time of the events giving rise to this claim, April and May 2024, it employed some 96 people at that location.[17]On 24 April 2024, administrators were appointed to the First Respondent. On that day, the employees of the First Respondent were called to a meeting and informed that they were at risk of redundancy, but that there was interest in the First Respondent’s business from potential buyers which might avoid any redundancy dismissals. However, on 29 April 2024, a further meeting was called, during which the employees were informed that no offers had been received for the business and therefore, due to the First Respondent’s financial position, payments were no longer able to be made to the employees, and they should regard their contracts of employment a terminated with effect from that day. 18. 90 of the employees were dismissed immediately on that date, with six employees remaining to deal with the closure of the business and premises, until they were also dismissed on 10 May 2024.[19]I was satisfied from the witnesses’ evidence, that twenty or more employees, in fact some 96 employees, had been dismissed at the First Respondent’s premises within a 90-day period. I was also satisfied that those dismissals were by reason of redundancy, in that the dismissals were wholly attributable to the fact that the First Respondent ceased to carry on the business for which the employees had been employed at that location.[20]The dismissals took effect between 29 April 2024 and 10 May 2024, and it appeared to me that the earliest it could be said that the proposals to dismiss by reason of redundancy occurred was on, or shortly before, 29 April 2024.[21]The Claimant was recognised by the First Respodennt in respect of its hourly-paid workers, and had been recognised since the 1970s.[22]Other than the notification of potential risk of redundancy on 24 April 2024, no information about the proposed redundancies was provided to any representative or to the employees generally, and no consultation about the proposed redundancies took place.
Conclusions
[23]In light of my findings, it was clear to me that there had been proposals to dismiss 20 or more employees by reason of redundancy at the First Respondent’s establishment in Treherbert. The obligation to consult under section 188 therefore arose.[24]It was also clear to me that there had been a complete failure by the First Respondent to comply with the obligations under section 188. No attempts were made to provide the Claimant or the employees with the required information or to consult with them.[25]In the circumstances, I was satisfied that it was appropriate to make a declaration that the Claimant’s claim was well-founded.[26]Following the guidance provided by the Court of Appeal in Susie Radin Ltd, I then considered that it was appropriate to order that the protected period should run for 90 days. As I have noted, there was no attempt by the First Respondent to provide information about the proposed redundancies or to consult on those redundancies. I therefore saw no reason to make any reduction from the 90 day period.[27]In conclusion, I directed that the First Respondent should be ordered to pay remuneration to the relevant individuals for the protected period, which began on the date of the first dismissals, 29 April 2024, and ran thereafter for 90 days.[28]The First Respondent needs to be aware of, and comply with, the recoupment provisions set out in Appendix 2. Authorised for issue by