The employer closed its bakeries and made redundancies, but without consultation. The ET decided it could make a protective award even if none of the employees had suffered any loss because the redundancies must follow.
Held: In the legislation there were provisions where sums were to be paid without any assessment of actual loss being made. ‘So it seems to us that despite the background of the desire to encourage consultation in order to avoid liability for unfair dismissal, and also despite the fact that in some areas the object of Parliament is clearly seen to be purely one of compensation, we have to look at the particular sections with which we are concerned and decide what precisely they lay down . . It seems to us that here it is important to bear in mind that the obligation which is imposed upon an employer is one in respect of descriptions of employees.’ It was ‘striking’ that s. 105 (5) of the 1975 Act did not refer to loss suffered by the employee. ‘So it would seem that basically the question is, how serious was the employer’s default in complying with the requirements of section 99? Obviously there can be defaults of different gravity. For example, one requirement of the Act is that necessary information shall be disclosed in writing. It might be that if all the information had been given orally to a trade union representative, a tribunal would not take a very serious view of that as a failure to comply with a requirement. On the other hand, failure to give reasons at all, or failure to include one of the matters specified in section 99 (5), might be more serious. A failure to consult at all, or consultation only at the last minute, might be taken to be even more serious.’
Slynn J analysed the basis of the protective award: ‘The question is, to compensate for what? It seems to us that it is to compensate for the failure to consult. It seems to us that here Parliament is providing that employers should, in this kind of potential or actual redundancy situation, discuss the matter with the union and the Secretary of State in the hope of achieving one or other of the alternative courses to which we have referred. True it is that the Tribunal has power to make a declaration. It seems to us that there is a duty, in the appropriate case, to make a declaration. In addition it seems to us that Parliament has given to the Industrial Tribunals the power, if they so decide, also to make a protective award which involves the payment of money. It seems to us that when that decision is taken, the question which has to be looked at is not the loss or potential loss of actual remuneration during the relevant period by the particular employee. It is to consider the loss of days of consultation which have occurred. The Tribunal will have to consider, how serious was the breach on the part of the employer? It may be that the employer has done everything that he can possibly do to ensure that his employees are found other employment. If that happens, a Tribunal may well take the view that either there should be no award or, if there is an award, it should be nominal. It does not seem to us that the Tribunal has to be satisfied, before it can make an award. that the employees have been paid during the relevant period. Indeed, if the application is made before the dismissals take place, these facts may not be known. It might be quite impossible to know, until the end of the period, what is the position so far as earnings from the same employer or from other sources are concerned.’ and
‘Therefore this case will now go back to the Industrial Tribunal for them to decide, on the material before them, whether there should be a protective award and, if so, what should be the length of the period which they find to be just and equitable in all the circumstances having regard to the seriousness of the employer’s default in complying with the requirements of the section.’ and
‘That, as the cases to which we have referred show quite clearly, will involve a consideration of the length of period, the nature of the default, and the ‘just and equitable’ provision. It will also involve a consideration of the steps which were taken by the employer to deal with the situation which arose and to obtain other employment for their employees, even though they were in breach of the obligation to consult.’
Slynn J
[1980] ICR 31, [1979] IRLR 339
Employment Protection Act 1975 99(5) 105(5)
England and Wales
Cited by:
Cited – Susie Radin Ltd v GMB and others CA 20-Feb-2004
The company made redundancies but failed to carry out any effective or honest consultation. The tribunal awarded the maximum 90 days protective order. The company appealed saying that it had given the employees greater notice than was strictly due. . .
Cited – Securicor Omega Express Ltd v GMB (A Trade Union) EAT 7-Apr-2003
EAT The company decided to close two branches and make redundancies. They presented the closure itself as a fait accompli to the union representatives. The Tribunal found that this involved a failure to consult . .
Lists of cited by and citing cases may be incomplete.
Employment
Leading Case
Updated: 09 November 2021; Ref: scu.194619