Protective claim award - lack of consultation
Discussion
Anyone clued up on the ins/outs of the title?
Example as follows:
Company X HQ is in 'A' location, they have locations for operations all around the country.
Company X go in to administration in beginning of March.
All employees (2000) are made redundant.
A small amount of employees (100-200 over the different locations) are retained to help look after the assets of the business until sold.
A trade union (there's two for all intents and purposes) is assembling a case to apply for a protective claim award for lack of consultation via tribunal.
Would the retained staff be entitled to be included in this protective claim despite being retained?
From what I understand these claims can take 12 months plus easily.
The staff will either be made redundant at a point the assets are sold or potentially TUPE'd into a buyer of the business as a whole.
Some of the retained staff have received opposite advice from the two unions involved.
Example as follows:
Company X HQ is in 'A' location, they have locations for operations all around the country.
Company X go in to administration in beginning of March.
All employees (2000) are made redundant.
A small amount of employees (100-200 over the different locations) are retained to help look after the assets of the business until sold.
A trade union (there's two for all intents and purposes) is assembling a case to apply for a protective claim award for lack of consultation via tribunal.
Would the retained staff be entitled to be included in this protective claim despite being retained?
From what I understand these claims can take 12 months plus easily.
The staff will either be made redundant at a point the assets are sold or potentially TUPE'd into a buyer of the business as a whole.
Some of the retained staff have received opposite advice from the two unions involved.
Edited by -Neil- on Wednesday 10th June 17:53
A protective claim award is when a company is forced to pay staff who have been laid off compensation for not having properly consulted with them prior. I believe the maximum amount equates to eight weeks pay.
'Consultation' can be an abstract term and open to interpretation unless the process is clearly set out in employment contracts. A line that says at the end of an email 'let me know if you need to discuss this further' may be classed as consultation (though might be argued that it's not in a court).
If administration was inevitable and providing staff got what they were supposed to get, then any PCA would be unlikely to succeed. In any case, a company goes into administration because it's run out of money. Liquidation of assets may raise some revenue but ahead of staff are HMRC and the Bank. Unions may rattle sabres but often they only win a point of principal.
Where it does get a bit murky is if the company is sold as a 'pre-pack' agreement. This is where the company goes into administration but a buyer for the company exists, ready to purchase it from an administrator.
The staff that have been retained obviously still work at the company so none of this applies to them.
HTH
'Consultation' can be an abstract term and open to interpretation unless the process is clearly set out in employment contracts. A line that says at the end of an email 'let me know if you need to discuss this further' may be classed as consultation (though might be argued that it's not in a court).
If administration was inevitable and providing staff got what they were supposed to get, then any PCA would be unlikely to succeed. In any case, a company goes into administration because it's run out of money. Liquidation of assets may raise some revenue but ahead of staff are HMRC and the Bank. Unions may rattle sabres but often they only win a point of principal.
Where it does get a bit murky is if the company is sold as a 'pre-pack' agreement. This is where the company goes into administration but a buyer for the company exists, ready to purchase it from an administrator.
The staff that have been retained obviously still work at the company so none of this applies to them.
HTH
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