Mr J Uddin and others v J Crew Ltd and The Secretary of State for Business Energy and Industrial Strategy: 2200142/2021 and others
JUDGMENT
[1]The Tribunal declares that the First Respondent failed to comply with the requirements of section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992.[2]The Tribunal makes a protective award of 90 days pay to the Claimants set out in the schedule to this judgment. The First Respondent is ordered to pay the said Claimants their remuneration for the protected period of 90 days beginning on 9 September 2020.[3]The Recoupment of Jobseekers Allowance and Income Support Regulations 1996 may apply to these awards.REASONS
[1]In this case some 21 Claimants who were employed by J. Crew UK Ltd seek a protective award following the insolvency of their former employer, which is now in creditors voluntary liquidation.[2]Mr Uddin some 19 other Claimants presented a claim on 10 January 2021 following a period of early conciliation from 8th to 10 December 2020. Ms Bedborough presented a claim on 24 December 2020 following a period of early conciliation from 18th to 24th November 2020. The claims were for a protective award and other amounts, although the Claimants today confirmed that at today’s hearing only a protective award was sought.[3]J Crew UK Limited presented a response to Ms Bedborough’s claim but there has been no response from the First Respondent in respect of Mr Uddin’s claim. The Secretary of State was notified as an interested party and has presented responses in which he neither supports nor resists the claims and asks for the Response to be treated as his written submissions for the hearing. These have been taken into account.[4]In order for the consultation obligations under section 188 of the Trade Union Labour Relations (Consolidation) Act 1992 to be engaged 20 or more dismissals must be proposed at one establishment within 90 days. An employee may bring a claim on his or her own behalf only if there is no recognised trade union or elected employee representatives.[5]In the case of USDAW and anor v Ethel Austin Ltd and ors 2015 ICR 675, (commonly known as the Woolworths case) the ECJ interpreted the term “establishment as designating, depending on the circumstances, the unit to which workers who were made redundant were assigned to carry out their duties. It was not essential in order for there to be an “establishment” that the unit in question was endowed with a management that could independently effect collective redundancies.” In this context they found that an “establishment” in the context of an undertaking, could consist of a distinct entity, having a certain degree of permanence and stability, which was assigned to perform one or more given tasks and which had a workforce, technical means and a certain organisational structure allowing for the accomplishment of those tasks.[6]The Tribunal heard evidence from both Ms Bedborough and Mr Uddin. In addition, we accepted into evidence witness statements from Mr Blower, Ms Urban, and Ms Khanom. From the evidence we have heard we make the following findings.[7]On 10 September 2020 all UK staff of J. Crew UK Limited were informed by the UK liquidators, via a zoom meeting, that they were dismissed with effect from 9 September 2020. There was no recognised trade union and nor had any employee representatives been elected.[8]The First Respondent is a clothes retailer which is owned by its US parent company J. Crew Group Inc. In the UK the First Respondent employed some 68 staff based at 7 locations all of which were geographically very close. There were 6 stores. 30 staff were employed at Regent Street, 10 staff across 2 stores in Lamb’s Conduit Street and Redchurch Street, 10 staff at Brompton Cross, 14 staff at Sloane Square, 7 staff at Marylebone High Street and 5 staff at head office, which was In Stevens Street.[9]Of the 21 Claimants who had brought claims for a protective award 12 (including Ms Bedborough and Mr Uddin) worked at the Regent Street store. It was clear that this was an establishment where the proposal to dismiss as redundant affected 20 or more employees. The issue for the Tribunal was whether the 9 other employees who had brought claims but were not based at Regent Street could be said to be working at separate establishments or whether it could be said that all of the UK employees in fact worked for one establishment, so that in calculating whether the proposal to dismiss as redundant 20 or more employees “at one establishment” should include employees working at the smaller stores. 6 of the Claimants were primarily based between the stores in Lamb’s Conduit Street and Redchurch Street. One Claimant, Ms Khan, was based at Brompton Cross and Ms Urban and Mr N Khan were based at Sloane Square.[10]All the UK stores were located within central London, within 6 miles of each other. Each store had its own manager, though the stores in Lamb’s Conduit Street and Redchurch Street shared a single manager. There was a very small Head Office team based in Stephen Street near Tottenham Court Road.[11]The contracts of employment of all staff provided for a place of work at a particular store but with a requirement to work at other stores as and when required. Although the staff rotas were devised on a store by store basis, sales staff would move between stores as and when required. Ms Bedborough estimated that the sales staff would work at another store once a week, while the store managers might work at another store once a month, but more frequently at busy periods such as Christmas. If a member of staff worked in another store there would be no recharge between the stores, Hours worked were tracked on a single enterprise system called Dayforce wherever the employee worked. Mr Uddin was responsible for stock levels in all the stores and would visit all of the stores each day. Mr Blower, for example who worked as a visual merchandiser worked across all the UK locations.[12]Each store had their own sales targets and overheads for accounting purposes. However, all ordering of stock, its distribution to the stores, all accounting, all visual merchandising as well as sales launches and promotional events were directed from the United States and was uniform across the stores. We understood that the computer system was centralised and managed from the US. The sales figures for individual stores were provided to the US and then made available and visible to the other stores. The senior management team from the US would visit once a quarter.[13]We considered whether the various stores were separate establishments for the purposes of section 188 of the Act or whether all the stores were in effect a single establishment. We considered that while there were factors pointing either way, the smaller stores could not be said to be separate establishments. While the fact that each store had its own sales targets and overheads, and that staff were principally attached to a particular store might suggest that they were a number of small but separate establishments we considered that other factors outweighed this. In particular the degree of control exercised by the US parent over all the London stores alike, as set out in paragraph 12 above, the geographical proximity of all the stores and as a consequence the extent to which staff moved between stores and the various factors set out above clearly suggests that all the London offices were operated as a single establishment.