EMCC European Monitoring Centre on Change

United Kingdom: Effects of non-compliance with dismissal regulations

United Kingdom
Phase: Management
Type:
Effects of non-compliance with dismissal regulations
Last modified: 16 May, 2019
Native name:

The Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 1995; Trade Union and Labour Relations (Consolidation) Act 1992

English name:

The Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 1995; Trade Union and Labour Relations (Consolidation) Act 1992

Article

Regulation 4 (Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 1995); Part IV, Chapter II, Section 189 (Trade Union and Labour Relations (Consolidation) Act 1992)

Description

The requirement to consult with employees that may be affected by collective redundancies is laid out in section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992, which is derived from Directive 98/58/EC concerning collective redundancies. It states that '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.'

Failure to comply with requirements to consult around collective dismissals can lead to compensations claims. Complaints are made by any of the affected employees under section 189 of the Trade Union and Labour Relations (Consolidated) Act 1992. Complaints may be lodged with the employment tribunal by employee representatives if there was a failure to elect employee representatives or if consultation was not undertaken with the appropriate representative who had the authority to represent the affected employees. They are made to an employment tribunal either before the date of the last dismissal, or within three months of the last dismissal date. This time limit can be extended if it is just and equitable to do so.

Onus is on the employer to demonstrate to the tribunal that the consultation requirements have been satisfied. Tribunals have the power to make a declaration that the employer is in breach of section 188 of the act and to make a protective award where the employer is ordered to pay remuneration for the protected period (up to a maximum of 90 days pay, depending on the circumstances and seriousness of the breach).  

An employer can argue existence of 'special circumstances' which made it impractical for them to comply with the requirement to consult or because it took reasonable steps towards compliance in the circumstances. 

Comments

A significant number of cases have been brought for non-compliance. Courts have been very unwilling to allow the 'special circumstances' defence. Research on behalf of the government in 2013 found that claims with an element of redundancy pay or consultation were most likely to be paid (in full or in part) without enforcement (69%), although it is worth noting that two-thirds of such claims (65%) were paid by government sources (e.g. the Redundancy Payments Office/Insolvency Service) and not by the employer. As a result, redundancy claims were also most likely to be paid in part without enforcement (22%), since government payments via the Insolvency Service are capped at maximum amounts. 

Cost covered by
  • Employer
Involved actors other than national government
  • Other
Involvement others
Employment tribunal
Thresholds
20
20
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