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Collective Consultation – it is never straight forward!Collective Consultation – it is never straight forward!

» Posted on: 31 March 2010
» Posted by: Oliver McCann
» Service area: Employment

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A recent case (Shanahan Engineering v Unite 2010) acts as a timely reminder about the importance of engaging in some form of collective consultation, even where it is not possible to meet the minimum period of consultation (30 day = 20-99 employees’, 90 days 100+).

An engineering company received notice from its customer to amend its working practices within 24 hours resulting in an immediate need to reduce the workforce by 50 employees. The need to make 20 or more redundant immediately triggered obligations to inform and consult under S.188 Trade Union & Labour Relations (consolidation) Act 1992 (“s.188) 50 staff were made redundant the day after the working practices were implemented.

Complaints were submitted by Unite, the recognised trade union, that the Company had failed to comply with its S.188 obligations. The Employer argued that there were special circumstances rendering it not reasonably practicable to comply with s.188.

An Employment Tribunal found that there were special circumstances rendering it not practicable to consult for a 30 day period but that there were no special circumstances preventing the Employer from engaging S.188 (2) and (4) – information in writing about the collective redundancy circumstances and the need to consult on ways to avoid dismissals, reducing the number of dismissals and mitigating consequences of those dismissals. The tribunal felt the Employer could have engaged in some consultation, albeit limited, over 2-3 days and as this had not occurred awarded 90 days protective award.

The employers appeal failed except on the point that the award should reflect the mitigating circumstances that existed. Remember the protective award is seen as punitive rather than compensatory and in this case a 90 day award was given.

One has to have sympathy with the Employer who, without proper notice, ended in a collective consultation obligation. However the reasoning of the Tribunals emphasizes that obligations under subsections of s.188 are not to be taken as one complete obligation, but instead viewed independent of each other with the over riding theme that an Employer must do all that is reasonable practicable to comply with each individual sub sections of s.188.

Some consultation is better than none and this case clearly indicates that even if consultation is limited to 2-3 days, it goes some way to complying with the obligations under s.188.

The case also reaffirmed the long held position that “special circumstances” means “something out of the ordinary, something uncommon” and reliance on this as a defence should really be seen as a step of last resort.

There are similar provisions which arise on a business transfers under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE 2006”). However there is no minimum number of employees which need to be affected and there is no minimum period of consultation, but instead consultation must take place long enough before the transfer. A similar approach to the obligations (“doing all that is reasonably practicable to comply”) under s.188 as set out in this case should also be adopted with TUPE 2006 obligations.

If you need guidance, advice or assistance on information and consultation, whether that be for redundancies or business transfers (including service provision changes) then call our Employment Team:

Oliver McCann (Employment Partner)
01254 297930

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