Miss R Toner v Herbivore Restaurants Ltd (in administration) and The Secretary of State for Business Energy and Industrial Strategy: 2213082/2023
EMPLOYMENT TRIBUNALS
Case No 2213082/2023
Between
Miss R TonerClaimant1. Herbivore Restaurants Limited (in administration) 2. The Secretary of State for Business, Energy and Industrial StrategyRespondent
Before
Employment Judge BrownMs N Toner (instructed by Solicitor) for claimantNot represented for respondentDate 21 June 2024
JUDGMENT
[1]The First Respondent breached its duties to consult about the dismissal, as redundant, of 20 or more employees at one establishment within a period of 90 days, pursuant to s188 and 188A Trade Union and Labour Relations Consolidation Act 1992.[2]The First Respondent was a single establishment for the purposes of s188 TULCRA 1992.[3]A protective award is made under s189 TULRCA 1992, for the protected period of 90 days, commencing on 2 May 2023, ordering that the First Respondent pay remuneration for the protected period, in respect of the First Respondent’s employees.
REASONS
[1]By a claim presented on 02 August 2023, the Claimant and Ms C Woolston brought a claim for a protective award against Herbivore Restaurants Limited (R1) which had entered administration on 11 May 2023.[2]The appointed administrators of R1 were David Taylor and Paul Ellison of KRE Corporate Recovery Limited (‘KRE’). Case Number: 2213082/2023[3]The Secretary of State for Business, Energy and Industrial Strategy was also named as Second Respondent.[4]R1 did not submit a response but gave consent for the claims to proceed on 1 December 2023.[5]R2 submitted a response on 22 September 2023. In the Secretary of State (“SoS”) Grounds of Resistance, the SoS said, amongst other things, that, “If after consideration of the facts, the Employment Tribunal is of the opinion that the present case involves employees at multiple establishments, the Secretary of State respectfully submits that those claimants who worked at establishments where the proposal to dismiss as redundant affected fewer than 20 employees are not entitled to any Protective Award. This is on the basis that the duty to consult under section 188 would not arise in such a case.”[6]The Second Respondent said that it would not attend the hearing today.[7]Ms C Woolston withdrew her claim.[8]Miss R Toner is the only remaining Claimant. Ms Toner provided a statement and gave oral evidence. She also provided a bundle of documents.
Relevant Facts
[9]R1 operated 3 restaurants from 3 premises; Unit G01, 100 Liverpool Street, London, (Broadgate), 60 Bartholomew Close, London EC1A (Barts) and Unit 1 50-60 Station Road, Cambridge, the Cambridge restaurant.[10]At the time of the dismissals in this case, R1 employed 58 employees.[11]24 employees were employed to work at both the Broadgate and the Barts restaurants. Only 3 employees worked at the Barts restaurant alone and only 2 employees worked at the Broadgate restaurant alone.[12]The employees in London were dismissed on 2 May 2023. The Claimant was dismissed by email of 2 May 2023.[13]The Claimant told me, and I accepted, that the employees in the First Respondent organisation worked as a team to promote the purpose of the restaurants, providing vegan plant based food for customers.[14]The chefs and management worked together for this purpose.[15]The First Respondent’s chefs moved around from restaurant to restaurant. Ed Subaei, the freelance executive head chef, worked at all the restaurants and created menus for all.[16]Management of the restaurants was also shared. The London based manager was John Daniels, who worked at both the Broadgate and Barts restaurants, but would also help Kirsten, the manager in Cambridge. Case Number: 2213082/2023[17]The Claimant herself had a large number of jobs and titles during her employment; starting as Front of House Supervisor, then progressing to Floor Manager, and finally Sustainability and Business Development Officer / Events Manager / Executive Assistant to one of the Directors.[18]The Claimant’s most recent contract provided that her place of work was based from home. However, the Claimant was expected to be in the London restaurants at least once a week and was required to help in all the restaurants as necessary.[19]She also travelled to and attended many of the First Respondent’s catering functions, many of which were held off site. She also helped to run the social media campaigns which were relevant to London only. She handled 95% of the First Respondent’s social media content. The Claimant created the virtual menus for special occasions such as Mother’s Day and circulated these to the three sites.[20]The Claimant would assist with transporting stock from Cambridge to London. She ran the booking system for all three sites, took incoming calls for all three sites, and managed the email inboxes for all three sites, as well as handling all pre orders for large bookings at each restaurant.[21]20 employees worked at the Cambridge restaurant alone and 9 employees, including the Claimant, worked in across all the restaurants and the business.[22]The Claimant received an email shortly after midnight on 02.05.23 from Jim Masterton, Director of the First Respondent p46-49. Mr Masterston said that the First Respondent had entered administration and that the Claimant was redundant with immediate effect.[23]More than 20 of the Claimant’s colleagues who were mainly working in London were dismissed on the same day. Mr Masterston said the reason for the administration was extreme cost escalations over the previous six months and lack of government funding.[24]He told the Claimant that she would not be paid her wages for April 2023.[25]The First Respondent did not enter administration until 11 May 2023.[26]The First Respondent did not arrange for the election of any employee representatives. It did not consult with the employees who were dismissed. There was no warning and no consultation before the Claimant’s dismissal. No-one was authorised to undertake collective consultation on her behalf and she was not asked to nominate a staff representative. There was no recognised trade union.
Law
[27]Chapter II of Part IV of the Trade Union and Labour Relations (Consolidation) Act 1992 ('the TULRCA') implemented the United Kingdom's obligations under EC Directive 98/59 in respect of England and Wales, and Scotland[28]s188(1) TULRCA provides that 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 is to consult about the dismissals all the persons who are Case Number: 2213082/2023 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.[29]Where an employer fails to comply with a requirement of s.188 of the TULRCA, an employment tribunal may make a protective award under s.189(2), which, according to s.189(3), is an award ordering the employer to pay remuneration for the protected period as defined in s.189(4).[30]USDAW v WW Realisation 1 Ltd: C-80/14, [2015] IRLR 577, the Court of Appeal had referred the following questions to the ECJ: '(1)(a) In Article 1(1)(a)(ii) of [Directive 98/59] does the phrase “at least 20” refer to the number of dismissals across all of the employer's establishments in which dismissals are effected within a 90 day period, or does it refer to the number of dismissals in each individual establishment? (b) If Article 1(1)(a)(ii) refers to the number of dismissals in each individual establishment, what is the meaning of “establishment”? In particular, should “establishment” be construed to mean the whole of the relevant retail business, being a single economic business unit, or such part of that business as is contemplating making redundancies, rather than a unit to which a worker is assigned their duties, such as each individual store.[31]The ECJ decided that the meaning of ‘establishment’ and ‘undertaking’ were different for the purposes of the Directive.[32]At paragraphs 44, 45 and 47 of its judgment, the ECJ stated as follows: “44. In paragraph 31 of the judgment in Rockfon (C-449/93, EU:C:1995:420, [1996] IRLR 168), the Court observed, referring to paragraph 15 of the judgment in Botzen and Others (186/83, EU:C:1985:58, [1985] ECR 519), that an employment relationship is essentially characterised by the link existing between the worker and the part of the undertaking or business to which he is assigned to carry out his duties. The Court therefore decided, in paragraph 32 of the judgment in Rockfon (C-449/93, EU:C:1995:420, [1996] IRLR 168), that the term 'establishment' in Article 1(1)(a) of Directive 98/59 must be interpreted as designating, depending on the circumstances, the unit to which the workers made redundant are assigned to carry out their duties. It is not essential in order for there to be an 'establishment' that the unit in question be endowed with a management that can independently effect collective redundancies. 45. In the judgment in Athinaïki Chartopoiïa (C-270/05, EU:C:2007:101, [2007] IRLR 284), the Court further clarified the term 'establishment', inter alia by holding, in paragraph 27 of that judgment, that, for the purposes of the application of Directive 98/59, an 'establishment', in the context of an undertaking, may consist of a distinct entity, having a certain degree of permanence and stability, which is assigned to perform one or more given tasks and which has a workforce, technical means and a certain organisational structure allowing for the accomplishment of those tasks. Case Number: 2213082/2023 … 47. In paragraph 28 of the judgment in Athinaïki Chartopoiïa (C-270/05, EU:C:2007:101, [2007] IRLR 284), the Court held that since Directive 98/59 concerns the socio-economic effects that collective redundancies may have in a given local context and social environment, the entity in question need not have any legal autonomy, nor need it have economic, financial, administrative or technological autonomy, in order to be regarded as an 'establishment'. 33. The ECJ then decided, at paragraph 49, that where an 'undertaking' comprises several entities meeting the criteria set out in paragraphs 44, 45 and 47, it is the entity to which the workers made redundant are assigned to carry out their duties that constitutes the 'establishment' for the purposes of Article 1(1)(a) of Directive 98/59, and the number of dismissals effected at that establishment must be taken into consideration separately from those that take place at the other establishments of that same undertaking.[34]S188A TULRCA 1992 makes provision for the election of employee representatives.[35]In GMB v Susie Radin Ltd [2004] EWCA Civ 180, [2004] 2 All ER 279, [2004] IRLR 400 Peter Gibson LJ, at paragraph 45 provided the following guidance: “I suggest that ETs, in deciding in the exercise of their discretion whether to make a protective award and for what period, should have the following matters in mind:(1) The purpose of the award is to provide a sanction for a breach by the employer of the obligations in 188: it is not to compensate the employees for loss they have suffered in consequence of the breach.(2) The ET have a wide discretion to do what is just and equitable in all the circumstance, but the focus should be on the seriousness of the employers default.(3) The default may vary in seriousness from the technical to a complete failure to provide any of the required information and to consult.(4) The deliberateness of the failure may be relevant, as may the availability to the employer of legal advice about his obligations under 188.(5) How the ET assesses the length of the protected period is a matter for the ET, but proper approach in a case where there has been no consultation is to start with the maximum period and reduce it only if there are mitigating circumstances justifying a reduction to an extent which the ET consider appropriate.” Discussion and Decision[36]I took into account all my findings of fact, and the relevant law, when reaching my decision.[37]I had to consider whether there separate establishments at the First Respondent undertaking, within the meaning in Athinaïki Chartopoiïa, in that there were distinct entities, having a certain degree of permanence and stability, which were assigned to Case Number: 2213082/2023 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.[38]I decided that there were not, but that the First Respondent consisted of one establishment.[39]This was because the management and chefs worked across all 3 sites, along with the Claimant, who managed booking system for all three sites, took incoming calls for all three sites, and managed the email inboxes for all three sites, as well as handling all pre orders for large bookings at all the restaurants. In addition, a large proportion of the other employees worked across 2 of the sites in London. Hardly any employees worked solely at the Barts or the Broadgate restaurants.[40]It would not have been possible for any one of the individual restaurants perform its task of providing vegan food for restaurant customers, without the management, chefs and employees, like the Claimant, who worked at, and for, all the sites. All utilised the same chefs, the same managers and the same support services. Without those vital employees, I decided that none of the sites had its own workforce, technical means and organisational structure which would have allowed them individually to provide vegan food for restaurant customers. As a matter of common sense, a restaurant cannot function as a restaurant without a chef. In addition, the business collectively provided catering off-site to other customers – this was not a task which was delivered by any individual site.[41]The Claimant was working at that single establishment, which was the First Respondent.[42]If I was wrong about that, then I decided that London restaurants were one establishment, given that the vast majority of staff – 24 in total – worked across both sites. Only 3 employees worked at the Barts restaurant alone and only 2 employees worked at the Broadgate restaurant alone. I decided that such low numbers of employees, without chefs, management or support services, could not have delivered any restaurant service to customers at either of the individual London premises. They had to constitute a single establishment for them to accomplish their tasks.[43]Again, I decided that the Claimant also worked at that establishment because, as well as working for all 3 sites, she was required, in particular, to attended the London restaurants every week, as part of her role.[44]24 employees were employed to work at both the Broadgate and the Barts restaurants.[45]The 29 employees in London were dismissed on 2 May 2023. The Claimant was also dismissed by email of 2 May 2023.[46]In the case of both ‘establishments’ I have identified (whether the First Respondent itself, or the London restaurants collectively) therefore, that the First Respondent dismissed more than 20 employees within a period of 90 days.[47]The First Respondent’s failure to inform and consult was complete in relation to s188 and 188A TULRCA. No employee representatives were elected and no consultation was undertaken. Case Number: 2213082/2023[48]I make a declaration that the First Respondent breached its obligation to consult about the dismissal, as redundant, of 20 or more employees at one establishment within a period of 90 days.[49]Applying the Susie Radin case, I make a 90 day protective award commencing on 2 May 2023, the date of the first of the redundancy dismissals in this case, and the date on which the Claimant was dismissed. As I have said, there was a total failure to inform and consult.[50]Seeing that I have decided that the First Respondent was a single establishment, the protective award is in respect of all the First Respondent’s employees.