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Redundancy: The Purpose of the Protective Award
A recent Court of Appeal case has examined the principles upon which a protective award for collective redundancies will be made.
The closure of the Employer’s factory resulted in excess of 100 Employees being made redundant. There was a recognition agreement with the trade union, however the factory closed less than four months after the Employer first indicated the possible closure of its factory. The union sought a protective award for the Employees, under the Trade Union and Labour Relations (Consolidation) Act 1992 s.189(2) for a breach of the Employer’s obligation under s.188 of the Act to consult before making redundancies.
The Court of Appeal expressed that the purpose of a protective award was to ensure meaningful consultation occurred between the Employer and the Employees, by providing a sanction for a breach of the Employer’s obligation to consult and not to compensate the individual employee for any loss suffered. Since there was no meaningful consultation with the trade union, a protective award for the maximum period of 90 days was to be awarded to each Employee.
The Court of Appeal felt that in a case where there was no consultation the employment tribunal was entitled to start with the maximum protected period and see if there were any circumstances justifying a reduction.
Practical Tips
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Commence Consultations |
When proposing to dismiss in excess of 20 Employees at one establishment, commence consultations within a period of 90 days or less with the Employees or their representatives before the first dismissal occurs. |
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Proposed Dismissals |
For the purposes of consultation, the Employer should disclose in writing, the reasons for the proposed dismissals, number of employees and number to be dismissed, method of selection and ways of carrying out the dismissals and finally the proposed method of calculating the amount of redundancy payments. |
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