Mr B Ruddy and Ms K Jarosz v Casual Dining Services Ltd and The Secretary of State for Business Energy & Industrial Strategy: 3212734/2020 and 3212735/2020

EMPLOYMENT TRIBUNALS

Case No 3212734/2020, 3212735/2020

Between

Mr B Ruddy and Ms K JaroszClaimant

(1) Casual Dining Services Limited (2) The Secretary of State for Business Energy & Industrial StrategyRespondent

Before

Employment Judge Russell (by Cloud Video Platform)

1st Claimant - Mr L McKay (instructed by Solicitor) for claimant

Not represented for respondent

Date 17 December 2021

JUDGMENT

[1]There was no appropriate representative elected for the purpose of consultation pursuant to Section 188 or 189 of the Trade Union and Labour Relations (Consolidation) Act 1992.

[2]The Claimant has jurisdiction to bring his claim as an individual employee.

[3]The First Respondent failed to carry out any consultation at all as required by s.188 TULR(C)A. A protective award is made in respect of all 23 employees made redundant at the establishment of Las Iguanas 2 July 2020. The protected period is 90 days from 2 July 2020.

REASONS

[1]By claim form presented to the Employment Tribunal on 9 October 2020, the Claimants bring a claim for a protective award pursuant to the Trade Union Labour Relations (Consolidation) Act 1992. Solicitors acting for the Second Claimant have withdrawn and now represent only the First Claimant. As a result, I have no information about the particular job, service or pay of the Second Claimant.

[2]The First Claimant was employed by the First Respondent as an Assistant Manager from 21 June 2017 until his dismissal by reason of redundancy on 2 July 2020.

[3]The First Claimant worked at Las Iguanas Restaurant, Charter Way, Freeport Designer Village, Braintree CM77 8YH.

[4]Employee information provided by the First Respondent lists very many Las Iguanas restaurants throughout the United Kingdom which went into administration and made the employees redundant. I am satisfied that Las Iguanas, Braintree is the relevant establishment for the purposes of deciding whether there was an obligation for collective consultation pursuant to the Trade Union Labour Relations Consolidation Act.

[5]There were 23 employees at Las Iguanas, Braintree. I accept the First Claimant’s evidence today that all 23 were made redundant on 2 July 2020, including the First and Second Claimants.

[6]It appears that the First Respondent fell into financial difficulty potentially as a result of the Covid-19 Pandemic which had a significant and well-known adverse impact upon the hospitality sector.

[7]The First Claimant was informed shortly before 24 June 2020 by his Area Manager that there would be elections for appropriate employee representatives in anticipation of significant redundancies. In fact, no such elections took place and instead, on 24 June 2020, the Area Manager told the First Claimant that he had been appointed to represent staff in planned future consultations. As there were no elections, I find that the Area Manager was not the elected representative for the purposes of Sections 188 and 189 TULR(C)A. as there was no elected representative or Trade Union representative the Claimant has locus to bring his claim as an affected employee.

[8]On 29 June 2020, a “Question and Answer” document was sent to the First Claimant by email suggesting that restaurants would be identified for future closure based upon profitability and suggesting that there would be a consultation period of at least a month. That did not in fact take place. Instead, on 2 July 2020 the First Claimant was informed that he was being made redundant with immediate effect because the First Respondent’s Las Iguanas restaurant at Braintree was being closed down. The First Respondent subsequently went into administration.

[9]I am satisfied that there was no effective consultation at all prior to redundancy. The appropriate period therefore starts from 2 July 2020. The affected employees are all of those employed at Las Iguanas, Braintree.

[10]In deciding the length of the protected period, I took into account the importance of consultation as set out in Susie Radin Limited v GMB

[2004] EWCA Civ 180

. This was a redundancy situation in which there was a total failure by the First Respondent to undertake any meaningful consultation. It must have anticipated the need for redundancies before 2 July 2020, not least as there was discussion about electing employee representatives shortly before 24 June 2020. Yet nothing was done. In the circumstances, I conclude that the protected period is 90-days having regard to the number of employees made redundant and the total failure to consult.

[11]I accept the First Claimant’s evidence and find that his average weekly net wage was £315.89, with an average daily net wage was £63.18. I have no information about the Second Claimant’s pay or length of service. Copies of the names, dates of service and pay for each of the 23 affected employees will need to be provided to the Secretary of State; this information is not known by the Tribunal. RECONSIDERATION JUDGMENT The Judgment sent to the parties on 29 December 2021 is revoked in its entirety.

[1]By a Judgment sent to the parties on 29 December 2021, the Tribunal made a protective award for the protected period of 90 days from 2 July 2020 because of the First Respondent’s failure to elect an appropriate representative and making more than 20 employees redundant on 2 July 2020. The protective award was said to apply to all 23 employees made redundant at the establishment that day, including the Claimants.

[2]By an email sent to the Tribunal on 31 December 2021, the Second Respondent sought reconsideration on two grounds:(1) the First Respondent had been dissolved on 8 October 2021 prior to the Judgment of the Employment Tribunal and as liability from the Secretary of State arises under s.184(2)(d) of the Employment Rights Act only as statutory guarantor of any liabilities against the employer, there could be no independent liability of the Second Respondent; and

(2) if liability did arise, the protective award could only apply to the two Claimants and not all employees as there were no elected representatives.

[3]On 6 January 2022, the First Claimant’s solicitor objected to the application on grounds that the First Respondent had not presented an ET3, administrators had given consent for the Claimant to proceed such that the hearing on 18 October 2021 was Case Number: 3212734/2020 and 3212735/2020 essentially only to gather information to make the relevant awards by way of rule 21 Judgment. Further the Second Respondent had not advanced the dissolution point before and it would not be in the interest of justice to allow it to raise a new point which could and should properly have been raised at the original hearing. Finally, that the reconsideration would cause severe prejudice to the Claimant as he would be deprived of a remedy.

[4]By a letter dated 1 August 2022, the parties were informed that I considered that it may be in the interest of justice to reconsider the Judgment for the reasons given by the Second Respondent, which may include consideration as to whether and to what extent the primary submission that it cannot be liable as guarantor following dissolution is consistent with the EU Collective Redundancy Directive and/or the effect of part 12 of the Employment Rights Act. I listed this hearing and made Orders that the parties should provide a bundle by 10 November 2022 and a skeleton argument by 24 November 2022.

[5]No such documents have been received. The Second Respondent’s representatives emailed on 17 August 2022 to indicate that they did not propose to be represented in person at this hearing and asked that the Tribunal accept the ET3 in place of written submission. Nothing was heard from the Claimants or the First Claimant’s solicitor. This was not helpful as the Second Respondent’s ET3 had not addressed the dissolution point as, at the time, the First Respondent had not been dissolved.

[6]I had regard to the contents of the file and am satisfied from a search at Companies House that the First Respondent was indeed dissolved with effect from 8 October 2021. It follows that at the date which I made the original Judgment it no longer existed. The Judgment was as a matter of law rendered a nullity as judgment cannot be entered against a company that has been dissolved. The Claimants have not reinstated the company to the register and, therefore, I am satisfied that the Judgment must be revoked.

[7]I considered the fairness point and question of any prejudice to the Claimants. The claims were initially listed for a hearing on 22 July 2021 which was postponed following an application by the Claimants’ representative. The delay was not caused by the Tribunal or the Respondents. Even if it were, the Judgment could not stand as the First Respondent no longer existed when it was made.

[8]I am satisfied that the Second Respondent’s liability under domestic legislation arises only as a guarantor to a valid Judgment made against the employer. With no valid judgment against the First Respondent there can be no liability for the Second Respondent. Neither party made any submissions on the EU Directive such that it is not a matter the Tribunal can take any further. For all of these reasons, the Judgment is revoked in its entirety. Acting