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'No Answer soon' on Protective Awards

There is unlikely to be a definitive answer any time soon on changes to protective awards which come under the Trade Union and Labour Relations (Consolidation) Act 1992.

The Act provides that collective redundancies relate to the establishment rather than a business as a whole.  This would mean that if a company was made up of 1,000 employees with many different locations (called “establishments” under the 1992 Act) there would only be a collective consultation at each location only if more than 20 employees where working at that location.

The well publicised downfall of Woolworths brought the fairness of this position into question. Larger stores would tend to have more than 20 employees and would come under a collective consultation and also be entitled to make a protective award claim if there was no consultation. However, smaller stores would not to if they employed less than 20 people. The Employment Appeal Tribunal ruled that this was not what was intended by the European Directive which required each member state to pass a law in this area. The 1992 Act is more restrictive than the Directive and the Appeal Tribunal found that this was unfair to those working in smaller stores.

The matter has now been referred by the Court of Appeal to the Court of Justice for the European Union to clarify this issue. Should the European courts agree with the Appeal Tribunal, employees who would have been previously excluded under the 1992 Act may now have a claim for a protective award.

If you feel that you may be affected by the changes to protective awards, then contact our employment law team for advice.

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