Unite the Union and Mr M Batchelor and others v Newman Bonar Ltd (in Liquidation) c/o B Carnegie Nimmo: 4100461/2024 and others

EMPLOYMENT TRIBUNALS (SCOTLAND)

Case No 4100461/2024

Between

Unite the Union and Mr M Batchelor and othersClaimant

Newman Bonar Ltd (in Liquidation)Respondent

Before

Employment Judge M Sutherland

Date 21 May 2024

JUDGMENT

[1]the respondent has failed to comply with its obligations under Section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 and the complaint brought by the first claimant accordingly succeeds.

[2]A protective award is made in favour of all employees of the Respondent who were dismissed as redundant in the protected period and the respondent is ordered to pay remuneration to them for the protected period of 90 days starting on 25 October 2023.

[3]The complaints brought by the second claimants do not succeed and are accordingly dismissed.

REASONS

[1]A final hearing was listed for today to determine complaints for a protective award for failure to consult under Section 188 the Trade Union and Labour Relations (Consolidation) Act 1992.

[2]The claimants had the benefit of professional representation. The complaints were not resisted by the Respondent who did not enter an appearance. The hearing was held by CVP.

[3]The claimants lodged a bundle of documents. Mark Bachelor, ex-employee of the Respondent, and Douglas Orchardson, Unite trade union official, gave evidence on their behalf.

List of Issues

[4]The issues to be determined were follows – Regulation 6 of the Transfer of Undertakings (Protection of Employment) Regulations 2006

a. Was there a relevant transfer under Regulation 3? Did the transferred organised grouping of resources or employees maintain an identify distinct from the remainder of the transferee’s undertaking?

b. Before such a transfer, was an independent trade union recognised to any extent by the transferor in respect of employees of any description who in consequence of the transfer became employees of the transferee? Sections 188 and 189 of the Trade Union and Labour Relations (Consolidation) Act 1992

c. Was the Respondent proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less?

d. Did the Respondent consult about the dismissals all the persons who are appropriate representatives of any employees who may be affected by the proposed dismissals?

e. Are the employees are of a description in respect of which an independent trade union is recognised by their employer?

f. Did the failure to comply with a requirement of Section 188 relate to the representatives of a trade union? Was a complaint presented by the trade union?

g. Is the Claimant entitled to a declaration and a protective award? What is the description of employees who have been, or it was proposed to, dismiss as redundant and the employer failed to consult?

h. What is the protected period, not exceeding 90 days? What is the date on which the first dismissal took effect? What period does the Tribunal consider to be just and equitable in all the circumstances having regard to the seriousness of the employer’s default?

i. Was the complaint presented to the tribunal during the period of 3 months (extended by early conciliation) beginning with the date on which the last of the dismissals took effect? If that was not reasonably practicable, was it presented within such further period as the Tribunal considers reasonable?

Findings of fact

[5]The Respondent was a manufacturer of yarns based at St Salvador Street, Dundee. The first claimant is an independent trade union. The second claimants (listed on the attached schedule) were employees of the respondent.

[6]The employees of the respondent were previously employed by Bonar Yarns Limited (BYL). The first claimant was formally recognised by BYL for the purposes of collective bargaining for all classes of employees (administration and manufacturing).

[7]BYL entered administration on 31 March 2023. On 19 April 2023 the business and assets of BYL were sold as a going concern to the respondent (at a time when it was known as Newman Yarns Limited). As part of that sale the employees of BYL also transferred to the Respondent. The Administrators considered that all employees transferred under ‘TUPE’.

[8]By interlocutor of the Sheriff Court at Dundee dated 25 October 2023, Blair Nimmo and Geoffrey Jacobs, Insolvency Practitioners of Interpath Limited, 130 St Vincent Street, Glasgow, G2 5AF, were appointed to be provisional liquidators of the respondent.

[9]On or around 25 October 2023, the respondent’s employees who were present in the workplace at St Salvador Street, Dundee, DD3 7EU, were informed that the respondent would be entering liquidation. With the exception of 2 or 3 employees, the entire workforce (around 60 employees) were advised that they were dismissed by reason of redundancy with immediate effect. This was confirmed by letter dated 30 October 2023. The remaining 2 or 3 employees, who were retained for the purposes of winding up the business, were dismissed around two months thereafter.

[10]The respondent did not undertook any consultation with the first claimant or any of the second claimants. No elections were arranged and no prior information was provided.

[11]On 9 November 2023, a Sheriff sitting at Dundee ordered that the respondent be wound up in pursuance of the Insolvency Act 1986 and appointed Mr Nimmo and Mr Jacobs to be the joint interim liquidators of the respondent. Observations on the evidence

[12]The standard of proof is on balance of probabilities, which means that if the Tribunal considers that, on the evidence, the occurrence of an event was more likely than not, then the Tribunal is satisfied that the event did occur. Facts may be proven by direct evidence (primary facts) or by reasonable inference drawn from primary facts (secondary facts).

[13]The witnesses were not challenged under cross examination but there was no reason to doubt the credibility or reliability of their testimony which was consistent with the documentary evidence. The law Transfer of Undertakings (Protection of Employment) Regulations 2006 Regulation 6 provides - “(1) This regulation applies where after a relevant transfer the transferred organised grouping of resources or employees maintains an identity distinct from the remainder of the transferee's undertaking. (2) Where before such a transfer an independent trade union is recognised to any extent by the transferor in respect of employees of any description who in consequence of the transfer become employees of the transferee, then, after the transfer—(a) the trade union shall be deemed to have been recognised by the transferee to the same extent in respect of employees of that description so employed; and

(b) any agreement for recognition may be varied or rescinded accordingly”. Trade Union and Labour Relations (Consolidation) Act 1992 Section 188 provides – “(1) 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. (1A) 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 45 days, and (b)otherwise, at least 30 days, before the first of the dismissals takes effect. (1B) For the purposes of this section the appropriate representatives of any affected employees are–(a)if the employees are 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)”. Section 189 provides - “(1) Where an employer has failed to comply with a requirement of section 188 or section 188A, a complaint may be presented to an employment tribunal on that ground–(a) in the case of a failure relating to the election of employee representatives, by any of the affected employees or by any of the employees who have been dismissed as redundant;(b) in the case of any other failure relating to employee representatives, by any of the employee representatives to whom the failure related,(c) in the case of failure relating to representatives of a trade union, by the trade union, and (d)in any other case, by any of the affected employees or by any of the employees who have been dismissed as redundant. (1A) If on a complaint under subsection (1) a question arises as to whether or not any employee representative was an appropriate representative for the purposes of section 188, it shall be for the employer to show that the employee representative had the authority to represent the affected employees. (1B) On a complaint under subsection (1)(a) it shall be for the employer to show that the requirements in section 188A have been satisfied. (2) If the tribunal finds the complaint well-founded it shall make a declaration to that effect and may also make a protective award. (3) A protective award is an award in respect of one or more descriptions of employees—(a) who have been dismissed as redundant, or whom it is proposed to dismiss as redundant, and(b) in respect of whose dismissal or proposed dismissal the employer has failed to comply with a requirement of section 188, ordering the employer to pay remuneration for the protected period. (4) The protected period—(a) 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 (b) 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;but shall not exceed 90 days . . . . (5) An industrial tribunal shall not consider a complaint under this section unless it is presented to the tribunal—(a) before the date on which the last of the dismissals to which the complaint relates takes effect, or (b) during the period of three months beginning with that date, or(c)where the tribunal is satisfied that it was not reasonably practicable for the complaint to be presented during the period of three months, within such further period as it considers reasonable. (5A) Where the complaint concerns a failure to comply with a requirement of section 188 or 188A, section 292A (extension of time limits to facilitate conciliation before institution of proceedings) applies for the purposes of subsection (5)(b). (6) If on a complaint under this section a question arises—(a) whether there were special circumstances which rendered it not reasonably practicable for the employer to comply with any requirement of section 188, or (b) whether he took all such steps towards compliance with that requirement as were reasonably practicable in those circumstances, it is for the employer to show that there were and that he did”. Claimant’s submissions

The law

[14]The Claimants’ submissions were in summary as follows – a. Having regard to the judgement of the Court of Appeal in Susie Radin Ltd v GMB and Others

[2004] IRLR 400

: the purpose of the award is to provide a sanction for breach; the focus should be on the seriousness of the employer's default; the default here was a complete failure; a proper approach where there has been no consultation is to start with the maximum period and reduce it only if there are mitigating circumstances and none were asserted. Discussion and decision

[15]Upon the sale of the yarn manufacturing business of BYL as a going concern (including the transfer of assets and employees), there was a transfer from BYL to the Respondent of an economic entity which retained its identity upon transfer. There was accordingly on 19 April 2023 a relevant transfer under Regulation 3 of the Transfer of Undertakings (Protection of Employment) Regulations 2006 from BYL as transferor to the Respondent as transferee.

[16]Before that the transfer, the first claimant was an independent trade union that was recognised by BYL in respect of all of its employees. As a consequence of the transfer those employees became employees of the respondent. The organised grouping of resources and employees that transferred maintained a distinct identify.

[17]Under Regulation 6 of the Transfer of Undertakings (Protection of Employment) Regulations 2006 the first claimant was deemed to be recognised by the Respondent as transferee to the same extent as it was recognised by BYL as transferor.

[18]On 25 October 2023 the Respondent proposed to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less.

[19]The Respondent did not consult about the dismissals with the first claimant or any of its employees including the second claimants. The employees are of a description in respect of which an independent trade union is recognised by their employer. The failure to comply with a requirement of Section 188 related to the representatives of a trade union. The complaint was presented by the trade union within 3 months (extended by early conciliation) of the date of the last dismissal and is accordingly in time. The complaints presented by the second claimants are dismissed because they do not have title to sue as employee.

[20]The first claimant is entitled to a declaration and a protective award. All of the employees were dismissed as redundant and the employer failed to consult in respect of their dismissals.

[21]The first dismissals took place on 25 October 2023. Considering all the circumstances including the Respondent’s total default, and in the absence of any mitigating circumstances, it is considered just and equitable to make an award for the full protected period of 90 days beginning with the date of the first dismissals. Employment Judge: M Sutherland Date of Judgment: 21 May 2024 Multiple Schedule Multiple: 4100644 - Newman Bonar Ltd Case Number Case Name Mr Mark Batchelor -v- Newman Bonar Ltd (In 4100462/2024 Liquidation) 4100463/2024 Mr Alexander Anderson -v- Newman Bonar Ltd 4100464/2024 Mr Su Ban -v- Newman Bonar Ltd 4100465/2024 Mrs Bernarda Bartosik -v- Newman Bonar Ltd 4100466/2024 Mr Dawid Bartosik -v- Newman Bonar Ltd 4100467/2024 Mr John Boyack -v- Newman Bonar Ltd 4100468/2024 Mr Neil Brown -v- Newman Bonar Ltd 4100469/2024 Mr Janis Bumeistars -v- Newman Bonar Ltd 4100470/2024 Ms Nicola Caldwell -v- Newman Bonar Ltd 4100471/2024 Mr Thomas Cumming -v- Newman Bonar Ltd 4100472/2024 Mr Kenneth Halliday -v- Newman Bonar Ltd 4100473/2024 Mr Bruce Harper -v- Newman Bonar Ltd 4100474/2024 Mr Jozef Kacmar -v- Newman Bonar Ltd 4100475/2024 Mr Kacper Kowalczyk -v- Newman Bonar Ltd 4100476/2024 Mr Chris Lafferty -v- Newman Bonar Ltd 4100477/2024 Mr Steven Laing -v- Newman Bonar Ltd 4100478/2024 Mr Gordon Lamb -v- Newman Bonar Ltd 4100479/2024 Mr Lawrence Ellis -v- Newman Bonar Ltd 4100480/2024 Ms Malgorzata Liro -v- Newman Bonar Ltd 4100481/2024 Mr Bruce Lyall -v- Newman Bonar Ltd 4100482/2024 Mr Derek Masterton -v- Newman Bonar Ltd 4100483/2024 Mr Craig McCluskey -v- Newman Bonar Ltd 4100484/2024 Mr Harry McMillan -v- Newman Bonar Ltd 4100485/2024 Mr William McRae -v- Newman Bonar Ltd 4100486/2024 Mr Stewart Meek -v- Newman Bonar Ltd 4100487/2024 Mr James Murray -v- Newman Bonar Ltd 4100488/2024 Mr Angus Payne -v- Newman Bonar Ltd 4100489/2024 Mr David Pratt -v- Newman Bonar Ltd 4100490/2024 Mr Andrew Pryde -v- Newman Bonar Ltd 4100491/2024 Mr Edward Pryde -v- Newman Bonar Ltd 4100492/2024 Mr Brian Reddichaw -v- Newman Bonar Ltd 4100493/2024 Mr Garry Simpson -v- Newman Bonar Ltd 4100494/2024 Mrs Fiona Sivewright -v- Newman Bonar Ltd 4100495/2024 Mr Lewis Stewart -v- Newman Bonar Ltd 4100496/2024 Mr Mark Stewart -v- Newman Bonar Ltd 4100497/2024 Mrs Weronika Strojewska -v- Newman Bonar Ltd 4100498/2024 Mr Lukasz Szramka -v- Newman Bonar Ltd 4100499/2024 Mr Greg Taylor -v- Newman Bonar Ltd 4100500/2024 Mr Liam Thomson -v- Newman Bonar Ltd 4100501/2024 Mr Alan Uribe -v- Newman Bonar Ltd 4100502/2024 Mr Noel Verano -v- Newman Bonar Ltd 4100503/2024 Mr Robert Walker -v- Newman Bonar Ltd 4100504/2024 Mr Derek Walls -v- Newman Bonar Ltd