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Collective Redundancies Part II - Consultation
Collective Redundancies Part II - Consultation
In this note we focus on the consultation requirements of collective redundancies. In the first article we look at when the laws apply. The first article can be accessed here.
In the first article we set out the first part of s188 (1) of the Trade Union & Labour Relations (Consolidation) Act 1992. That section goes on to state that when the rules are triggered “…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.]”.
Below we highlight some of the key aspects to consider:
1. Who is covered?
This means the first step is to identify the “affected” employees and their “appropriate representatives”.
While that may sound easy enough, it covers those “affected by measures taken”, meaning the group with whom you need to consult may be bigger than those who are ‘at risk’ of redundancy. It is not the number affected that dictates whether collective consultation is triggered, but when you propose to dismiss as redundant more than 20 people in a 90 day period, as our first article explains.
As for “appropriate representatives”, this may be covered if there is a recognised trade union and, if so, that union must be consulted. If not, it can be a group already elected to represent the staff provided certain procedures have been met in relation to that group. Alternatively, and in most cases, there will be neither and so set procedures need to be followed in order to allow the affected staff to elect representatives for the purposes of the consultation.
2. Representatives
Whichever form the representatives take, you must ensure all affected employees are represented. The role of the representative is specific as is the election process that needs to be followed, but both are outside the scope of this note.
If you need to arrange an election, the set requirements need to be met and, if not, that on its own can constitute a breach of the rules triggering a protective award. Subject to this, it is largely up to you as to how you divide the staff/representatives. If no representatives are elected, then you must consult with each individual employee.
3. Information and Consultation
Once the representatives are identified, consultation can commence. Broadly, there are two stages to the process. Firstly, information needs to be provided. Secondly, there then needs to follow consultation on the proposals/information.
The first stage should be easier to meet than the second. There are set topics on which information should be provided in writing. The information must be sufficiently adequate to enable the second stage to be achieved.
The second stage is covered by s 188 (2) of the Trade Union & Labour Relations (Consolidation) Act 1992, which expressly states that:
“The consultation shall include consultation about ways of
–
(a) avoiding the dismissals;
(b) reducing the number of employees to be dismissed, and
(c) mitigating the consequences of the dismissals,
and shall be undertaken by the employer with a view to reaching agreement with the appropriate representatives.”
4. Agreement
What will probably stand out most from the above is the requirement for consultation to be undertaken “with a view to reaching agreement”.
This means approaching the consultation with an open mind. The obligation triggers at the point at which dismissals are proposed, so the aim of the consultation is to involve the staff, via their elected representative(s), to find ways of avoiding the proposed dismissals.
This may mean that the proposals change/evolve during the consultation. If so, further information may be required, but (depending on the circumstances), it should not result in you needing to re-start the consultation.
5. Impact of furlough leave
With staff on furlough leave it raises a couple of difficult issues.
Firstly, can those furloughed be elected as representatives. The Government’s guidance specifically states “To be eligible for the grant, when on furlough, an employee cannot undertake work for, or on behalf, of the organisation or any linked or associated organisation. This includes providing services or generating revenue”. While the representatives will not be generating revenue, it’s not clear whether acting as a representative means they are “…providing services...” or undertaking “…work…” on behalf of the organisation.
Secondly, if the business is closed, can consultation happen? In a TUPE case, the Employment Appeal Tribunal (“EAT”) has held that consultation could not take place during an annual shutdown, so this would seem to suggest that if, owing to COVID 19, a business is closed it cannot consult and, where this is an EAT authority, Employment Tribunals will be bound by it.
6. Special circumstances
You have a potential (and limited) defence where there exist “…special circumstances which render it not reasonably practicable for the employer to comply…” provided you “…take all such steps towards compliance with that requirement as are reasonably practicable…”.
While there have been attempts over the years to seek protection from this defence, most have failed. However, COVID 19 may give genuine reasons why certain steps were missed, reduced or limited. The use of the defence will be fact specific so based on the information you have available at the time and the situation you are in.
7. Time
The Trade Union & Labour Relations (Consolidation) Act 1992 does not require a specific timetable to be followed nor for the consultation to begin on a specific date; just that it must take place “in good time”. Generally, consultation begins once representatives are elected and the required information is provided to them. It must start before any final decisions are made on redundancies and before any dismissal take effect.
It should continue for the minimum periods provided (30 or 45 days), or longer, if the specific consultation topics have not been covered. No notice of dismissal should be served until the consultation has ended.
Compliance with the collective redundancy rules is certainly possible to achieve given the procedural nature of it, but requires planning, time and effort to get it right.
There are many pitfalls that can easily result in a breach of the rules and trigger a protective award. Further, the usual right of unfair dismissal needs to be considered, as these claims will also be available to those employees who are eligible to pursue them.
If you are contemplating dismissals as we approach the end of the furlough period, please do as the Government’s guidance suggests and seek legal advice to ensure you are not triggering the need to consult collectively.
If you would like specific advice, please contact the writer, Matthew Kilgannon, via mk@kilgannonlaw.co.uk
or on 01483 388 901.
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