A tribunal has recently awarded £67.8m to thousands of ex-Woolworth employees after the shop workers’ union Usdaw successfully claimed that administrators had failed to follow correct redundancy procedures when the stores were closed in late 2008/early 2009.
Usdaw claimed that administrators did not carry out collective consultation with the union prior to making the redundancies and therefore failed to meet their legal obligations. As a result, members of the union are set to receive a protective award of 60 days’ pay (capped at £400 gross pay per week).
Controversially, approximately 3,000 staff who worked in smaller stores employing less than 20 workers will not receive any compensation due to the current rules regarding collective consultation. UK employers are only obliged to consult collectively with unions or staff representatives where it is proposed to make 20 or more employees redundant within a 90-day period at one establishment
Usdaw national officer John Gorle commented “I’m bitterly disappointed that a tribunal has limited the scope of the award. The fact that some of our members won’t be compensated simply because their store had less than 20 employees is just plain wrong and shows the gaping loophole and injustice of the current legislation. Nearly 30,000 employees were made redundant from Woolworths at the same time and for the same reason, so to suggest 3,000 of them didn’t constitute a collective redundancy is a nonsense”.
The union has confirmed that it will appeal the decision.
