THE INDUSTRIAL TRIBUNALS

CASE REF:	758/15-
766/15

CLAIMANTS:		Lewis Lee
				Michael Thompson
				Ryan Brown
				Howard Wilson
				Robert Carnwath
				Terry Dineen
				Steven Parkes
				Shaun Brown
				Joanne Mullan

RESPONDENT:		City Link Ltd (In Administration)

DECISION 
(A)	Each claimant’s complaint under Article 217 of the Employment Rights Order 1996 (“ERO”) is well-founded.

(B)	We have decided to make a protective award.  

(C)	It is ordered that the respondent shall pay remuneration for the protected period.

(D)	The protected period began on 31 December 2014 and lasted for 90 days.

(E)	This protective award applies to all of the persons specified or referred to at paragraph 33 below.

The attention of the parties is drawn to the Recoupment Statement at the end of this Decision.

The address of the respondent is: c/o Ernest Young LLP, 100 Barbirolli Square, Manchester, M2 3EY. 

Constitution of Tribunal:

Employment Judge:	Employment Judge Buggy
	
Members:			Mr C McIlwaine
				Ms M J McReynolds

Appearances:

The claimants were represented by Mr C Huddleston, Barrister-at-Law.

The respondent was not represented.

REASONS
1.	Each of the claimants worked for the respondent company (“the Company”) until 31 December 2014.  With effect from the latter date, each of the claimants was dismissed.  With effect from the same date, all of the other Northern Ireland-based employees of the Company were also dismissed.  Those other dismissals also took immediate effect.  Each of the relevant dismissals was a dismissal by reason of redundancy.  At the same time, thousands of Great Britain-based employees of the Company were also being dismissed.  The latter dismissals were also by reason of redundancy.  

2.	In relation to the relevant Northern Ireland redundancies, each of these nine complainants (“claimants”) make a complaint under Article 217 of ERO.   

Some key legislative provisions

3.	In the event of redundancies being proposed, Article 216 of ERO imposes a duty upon an employer, in some situations, to collectively consult with representatives of all or part of its workforce.  Article 216A of that Order imposes requirements in relation to the election of such representatives.  Article 217 of ERO provides for the making of a complaint to a tribunal in respect of an alleged failure to comply with Article 216 and/or with Article 216A.  Articles 216, 216A and 217 of ERO have to be read in conjunction with Articles 218-226 of that Order.  Articles 216-226 are to be found in Part XIII of ERO, which is entitled “Procedure for handling redundancies”.

4.	Articles 216, 216A and 217, as amended, implement, in respect of Northern Ireland, the obligations which are imposed upon the United Kingdom by EU Directive 98/59 EC (“the 1998 Directive”).

5.	Article 216 of ERO provides as follows:

“216.—(1) 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; 

(2) 	The consultation shall begin in good time and in any event— 

(a)	where the employer is proposing to dismiss 100 or more employees as mentioned in paragraph (1), at least 90 days, and
 
(b)	otherwise, at least 30 days, 

before the first of the dismissals takes effect. 

(3) 	For the purposes of this Article the appropriate representatives of any affected employees are— 

(a)	if the employees are of a description in respect of which an independent trade union is recognised by their employer, representatives of the trade union, or 

(b)	in any other case, whichever of the following employee representatives the employer chooses— 

(i)	employee representatives appointed or elected by the affected employees otherwise than for the purposes of this Article, who (having regard to the purposes for and the method by which they were appointed or elected) have authority from those employees to receive information and to be consulted about the proposed dismissals on their behalf;

(ii)	employee representatives elected by the affected employees, for the purposes of this Article, in an election satisfying the requirements of Article 216A(1).

(4) 	The consultation shall include consultation about ways of— 

(a)	avoiding the dismissals, 

(b)	reducing the numbers 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. 

(5) 	In determining how many employees an employer is proposing to dismiss as redundant no account shall be taken of employees in respect of whose proposed dismissals consultation has already begun. 

(6) 	For the purposes of the consultation the employer shall disclose in writing to the appropriate representatives— 

(a)	the reasons for his proposals,
 
(b)	the numbers and descriptions of employees whom it is proposed to dismiss as redundant, 

(c)	the total number of employees of any such description employed by the employer at the establishment in question,
 
(d)	the proposed method of selecting the employees who may be dismissed, 

(e)	the proposed method of carrying out the dismissals, with due regard to any agreed procedure, including the period over which the dismissals are to take effect, 

(f)	the proposed method of calculating the amount of any redundancy payments to be made (otherwise than in compliance with an obligation imposed by or by virtue of any statutory provision) to employees who may be dismissed. 

(g)	the number of agency workers working temporarily for and under the supervision and direction of the employer, 

(h)	the parts of the employer's undertaking in which those agency workers are working, and 

(i)	the type of work those agency workers are carrying out.

(7) 	That information shall be given to each of the appropriate representatives by being delivered to them, or sent by post to an address notified by them to the employer, or (in the case of representatives of a trade union) sent by post to the union at the address of its head or main office. 

(8) 	The employer shall allow the appropriate representatives access to the affected employees and shall afford to those representatives such accommodation and other facilities as may be appropriate. 

(9)	 If in any case there are special circumstances which render it not reasonably practicable for the employer to comply with a requirement of paragraph (2), (4) or (6), the employer shall take all such steps towards compliance with that requirement as are reasonably practicable in those circumstances. 

(10) 	Where the decision leading to the proposed dismissals is that of a person controlling the employer (directly or indirectly), a failure on the part of that person to provide information to the employer shall not constitute special circumstances rendering it not reasonably practicable for the employer to comply with any of those requirements. 

(11) 	Where— 

(a)	the employer has invited any of the affected employees to elect employees representatives, and
 
(b)	the invitation was issued long enough before the time when the consultation is required by paragraph (2)(a) or (b) to begin to allow them to elect representatives by that time, 

the employer shall be treated as complying with the requirements of this Article in relation to those employees if he complies with those requirements as soon as is reasonably practicable after the election of the representatives. 

(11A) 	If, after the employer has invited affected employees to elect representatives, the affected employees have failed to do so within a reasonable time, he shall give to each affected employee the information set out in paragraph (6). 

(12) 	This Article does not confer any rights on a trade union, a representative or an employee except as provided by Articles 217 to 220. 

(13) 	In this Article “"agency worker”” has the same meaning as in regulation 3 of the Agency Workers Regulations (Northern Ireland) 2011.”

6.	Article 217 of ERO provides as follows:

“217.—(1) 	Where an employer has failed to comply with a requirement of Article 216 or Article 216A, a complaint may be presented to an industrial tribunal on that ground— 

(a)	in the case of a failure relating to the election of employee representatives, by any of the affected employees or by any of the employees who have been dismissed as redundant, 

(b)	in the case of any other failure relating to employee representatives, by any of the employee representatives to whom the failure related, 

(c)	in the case of failure relating to representatives of a trade union, by the trade union, and 

(d)	in any other case, by any of the affected employees or by any of the employees who have been dismissed as redundant. 

(1A) 	If on a complaint under paragraph (1) a question arises as to whether or not any employee representative was an appropriate representative for the purposes of Article 216, it shall be for the employer to show that the employee representative had the authority to represent the affected employees. 

(1B) 	On a complaint under paragraph (1)(a) it shall be for the employer to show that the requirements in Article 216A have been satisfied. 

(2) 	If the tribunal finds the complaint well-founded it shall make a declaration to that effect and may also make a protective award. 

(3) 	A protective award is an award in respect of one or more descriptions of employees— 

(a)	who have been dismissed as redundant, or whom it is proposed to dismiss as redundant, and 

(b)	in respect of whose dismissal or proposed dismissal the employer has failed to comply with a requirement of Article 216, 

ordering the employer to pay remuneration for the protected period. 

(4) 	The protected period— 

(a)	begins with the date on which the first of the dismissals to which the complaint relates takes effect, or the date of the award, whichever is the earlier, and 

(b)	is of such length as the tribunal determines to be just and equitable in all the circumstances having regard to the seriousness of the employer's default in complying with any requirement of Article 216; 

	but shall not exceed 90 days  . . . 

(5) 	An industrial tribunal shall not consider a complaint under this Article unless it is presented to the tribunal— 

(a)	before the date on which the last of the dismissals to which the complaint relates takes effect, or 

(b)	during the period of three months beginning with that date, or 

(c)	within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented during that period of three months. 

(6) 	If on a complaint under this Article a question arises— 

	(a)	whether there were special circumstances which rendered it not reasonably practicable for the employer to comply with any requirement of Article 216, or 

	(b)	whether he took all such steps towards compliance with that requirement as were reasonably practicable in those circumstances, 

	it is for the employer to show that there were and that he did.”

The evidence

7.	We received oral testimony on behalf of the claimants from two of them, Mr Steven Parkes and Mr Lewis Lee.  We were satisfied that each of them was an honest and accurate witness.

8.	Our attention was also drawn to some miscellaneous documents, during the course of the hearing.

The facts

9.	In the following sub-paragraphs, we set out findings of fact which are relevant to the issues which we have determined in these proceedings.

(1)	Each of these claimants was employed by the Company in its Northern Ireland depot.  That depot consisted of the Company’s Nutts Corner warehouse.  All the Northern Ireland-based staff of the Company, of which there were more than 20, operated out of that warehouse.  

(2)	Mr Parkes and Mr Lee were both warehouse operatives.

(3)	All of these claimants were dismissed by reason of redundancy along with thousands of the Company’s other employees across 53 depots throughout the United Kingdom.  

(4)	The first relevant dismissals (of Northern Ireland employees of the Company) occurred on 31 January 2015 and the last of the Northern Ireland dismissals occurred within 90 days thereafter.     

(5)	Most of the Northern Ireland employees of the Company learned of their impending dismissal while watching television during the festive period (during and after Christmas 2014).  

(6)	The Company was placed in administration on Christmas Eve 2014.    

(7)	Before the relevant dismissals occurred, there was no collective consultation of any kind, of the type which is contemplated by Article 216 of ERO.   

(8)	In respect of the Northern Ireland operations of the Company, no trade union was recognised for collective bargaining purposes.    

(9)	In December 2014, no employee forum had been established in respect of the Northern Ireland staff of the Company.    

10.	For ease of reference, and in order to minimise avoidable duplication, we have also set out some additional findings of fact elsewhere in this Decision.

The issues

11.	The administrators have consented to the bringing of these proceedings.  We have identified the following issues as being relevant in the context of this Decision:

	(1)	Were the Article 216 and/or Article 216A duties complied with?

	(2)	If the Article 216 duties were not complied with, were there special circumstances which rendered it not reasonably practicable for the Company to comply with any requirement of Article 216?  (See paragraph (6) of Article 217).

	(3)	If the Article 216 duties were not complied with, and there were circumstances which rendered it not reasonably practicable for the Company to do so, did the Company take all such steps towards compliance (with the relevant duties) as were reasonably practicable in those circumstances?  (See paragraph (6) of Article 217).  

	(4)	If the Article 217 complaint is well-founded, should we make a protective award?

	(5)	In the context of any protective award, when should the protected period begin?

	(6)	What should be the duration of the protected period?

	(7)	Who should be within the scope of the award?

Did the Company comply with the Article 216 and/or Article 216A duties? 

12.	It is clear to us that, in December 2014, the Company, in relation to its Northern Ireland operations had no “appropriate representatives” within the meaning of Article 216.  It is also clear that, during that month, no efforts were made to facilitate the appointment or election of such representatives.  It is also clear that, throughout the month of December 2014, no collective consultation whatsoever (“collective” consultation being consultation of the type which is envisaged in Article 216) took place in respect of the proposed Northern Ireland redundancies.  

13.	Accordingly, we are sure that the Company did not comply with its Article 216 or Article 216A duties.  

Impracticable?

14.	The implication of paragraph (9) of Article 216 is that, even if the Article 216 duties, or some of them, are not discharged, there will not be an actionable failure to comply (within the meaning of Article 217) if there were “special circumstances” which rendered it not reasonably practicable for the employer to comply with one or more of the relevant requirements.  

15.	There is clear case law which shows that insolvency does not, in itself, meet the threshold of the impracticability within the context of Article 216(9).

16.	In a detailed response, which has been presented in these proceedings, the administrators have specified certain difficulties which, in the view of the administrators, rendered it impracticable for the Company to collectively consult.  

17.	However, we note that paragraph (6) of Article 217 provides that, if a question arises, in the context of an Article 217 complaint, whether there were special circumstances which rendered it not reasonably practicable for the employer to comply with any requirement of Article 216, it is for the employer to show that there were such circumstances.  The respondent has not presented any oral testimony in these proceedings.  (Indeed, the respondent was not represented during this hearing).  In our view, the simple assertion of facts in a written document, even a document as significant as the response which was presented in these proceedings, provides an insufficient basis for “showing” that there were special circumstances.  

18.	Accordingly, we are not satisfied that there were special circumstances which rendered it not reasonably practicable to comply with any one or more of the relevant requirements.  

19.	Therefore, each of the Article 217 complaints in these proceedings is well-founded.  

“All such steps”?

20.	Even if we had been satisfied that there were circumstances which rendered it not reasonably practicable to comply with Article 216 requirements, the Article 217 complaints would still be well-founded, because the Company took no steps at all towards compliance, even though some such steps would have been practicable.  (See paragraph 28 below).  

Should we make a protective award?

21.	Paragraph (2) of Article 217 provides that, if a tribunal finds that an Article 217 complaint is well-founded, it “... may ... make a protective award”.  

22.	In most circumstances, if there has been non-compliance with a requirement of Article 216 (other than a technical or peripheral requirement), it is, for practical purposes, inevitable that a tribunal will exercise the relevant discretion in favour of making a protective award.  (In this general connection, see paragraph 63 of the judgment of the Court of Appeal in Haine v Day [2008] IRLR 642).  

23.	In this case, the relevant non-compliances were not merely technical or peripheral.  We consider it to be appropriate to make a protective award.

The commencement date

24.	Paragraph (4) of Article 217 provides that, in respect of any protective award, the protected period is to begin:

	“... with the date on which the first of the dismissals to which the complaint relates takes effect, or the date of the award, whichever is the earlier”.

25.	Accordingly, in the circumstances of this case, the date of commencement of the protective award is 31 December 2014.  

The duration of the protective award

26.	We have decided that it is appropriate to make a protective award of 90 days’ duration in this case.  In arriving at that determination, we have had regard to the guidance which was set out in the judgment of Gibson LJ in Susie Radin v GMB [2004] ICR 893.  At paragraph 45 of his judgment, Gibson LJ made the following observations, in relation to the legislation in Great Britain which corresponds to Article 216 of ERO:

“I suggest that ETs, in deciding in the exercise of their discretion whether to make a protective award and for what period, should have the following matters in mind: 

(1) 	The purpose of the award is to provide a sanction for breach by the employer of the obligations in s.188 [the Great Britain equivalent of Article 216 of ERO]: it is not to compensate the employees for loss which they have suffered in consequence of the breach.

(2) 	The ET have a wide discretion to do what is just and equitable in all the circumstances, but the focus should be on the seriousness of the employer's default.

(3) 	The default may vary in seriousness from the technical to a complete failure to provide any of the required information and to consult.

(4)	The deliberateness of the failure may be relevant, as may the availability to the employer of legal advice about his obligations under s.188.
  
(5) 	How the ET assesses the length of the protected period is a matter for the ET, but a proper approach in a case where there has been no consultation is to start with the maximum period and reduce it only if there are mitigating circumstances justifying a reduction to an extent which the ET consider appropriate.”

27.	In our view, there has been no sufficient evidence of mitigating circumstances in this case.  

28.	It is true that, in a lengthy response, which has been presented in these proceedings, the Company has asserted that there are various mitigating factors.  However, the accuracy, or otherwise, of those assertions, has not been tested, because no oral testimony has been provided on behalf of the Company.  We have little difficulty in accepting that, in the circumstances in which it then found itself, the Company could not continue to trade for long after Christmas 2014.  However, in deciding upon the length of the protective award, we have thought it appropriate to focus on the potential quality of any possible collective consultation, rather than its duration.  In our view, even in the circumstances in which the Company found itself during Christmas 2014, it would have been open to the Company, at least in Northern Ireland, to quickly facilitate the election of authorised representatives, and to have had brief, candid and respectful discussions with the relevant newly-elected workers’ representatives.  All of that could possibly have been achieved within the course of one or two days.  But nothing was done to facilitate such an election, and nothing amounting to, or conducive to, collective consultation was carried out in Northern Ireland, or in respect of Northern Ireland.  In our view, against that background, and for those reasons, the maximum award is appropriate.  

The scope of the award

29.	Paragraph (3) of Article 217 identifies the potential scope of a protective award, in the following terms:

“(3)	A protective award is an award in respect of one or more descriptions of 
		employees – 

(a)	who have been dismissed as redundant, or whom it is proposed to dismiss as redundant, and

(b)	in respect of whose dismissal or proposed dismissal the employer has failed to comply with a requirement of Article 216”.

30. 	We consider that, in relation to any particular situation in which the Article 216 duties are triggered, Article 217 is designed to facilitate a once-and-for-all adjudication and, as a consequence of that adjudication: 

(1)	a singular and comprehensive declaration and

(2)	a singular and comprehensive protective award (if any protective award is to be made).    

31.	We consider that, in the circumstances of the Company’s December 2014 redundancies, it is appropriate for us to make a one-off and comprehensive protective award in respect of all the redundant workers who belonged to the Company’s Northern Ireland establishment. 

32.	We have decided to make a protective award in respect of all of the employees who are identified in the next paragraph below.  

33.	The protective award applies to all of the following ex-employees of the Company:

(1)	all of the claimants in these proceedings; and

(2)	all of the other Northern Ireland-based employees of the Company who were made redundant on or after 31 December 2014.

34.	In deciding on the scope of the protective award, we have noted and applied the legal principles which were set out and referred to in an industrial tribunal Decision in William Glendinning v  Mivan (No1) Ltd (In Administration) [CRN: 470/14, Decision issued on 10 December 2014].

35.	That was a Decision which I made.  

36.	At this point in this Decision, we think it will be helpful to quote paragraphs 13-29 of Glendinning:

“13.	In considering the personal scope of the protective award, I have noted the statements of legal principle which are set out at paragraphs 267-309 of Dempsey.  I have applied those principles in light of facts of this case.  

14.	Paragraphs 267-309 of Dempsey are set out as an annex to this decision.

15.	I was a member of the full tribunal which decided Dempsey.  Having given fresh consideration to the statements of the law which are set out at paragraphs 267-309 of Dempsey, I continue to be of the view that those statements are correct.  In that connection, I add the contents of paragraphs 16-20 below.  
  
16.	At paragraph 302, the Dempsey tribunal compared the GB equivalent of an Article 217 complaint (a complaint under Article 217 of ERO) to regulatory interventions, such as those provided for under section 35 of the Fair Trading Act 1973 or those provided for under Regulation 12 of the Unfair Contract Terms in Consumer Contracts Regulations 1999.  In my view, an Article 217 complaint is also comparable, in some important respects, to derivative actions, which are provided for in the Companies Act 2006.

17.	A “derivative action” is so called because it is regarded as a cause of action derived from, and exercised on behalf of, the company.  (The reason why a particular shareholder is allowed to pursue a derivative action is because the normally appropriate litigant – the company – is, exceptionally, unable or unwilling to take the necessary action).

18.	In Dempsey, the conclusions of the tribunal which are relevant in the present context included the following:

(1)	The proper personal scope of a protective award granted pursuant to Article 217 of ERO was likely to be identical to what had been the proper scope of a protective award made under the Employment Rights Act 1975.

(2)	The proper scope of a protective award granted pursuant to the 1975 Act had to be discerned in light of the requirements which had been imposed by the 1975 Collective Redundancies Directive.

(3)	The relevant provision of the 1975 Act envisaged a single, once-and-for-all adjudication, by a tribunal, on the question of whether or not the collective consultation duties had been complied with.

(4)	The purpose of providing a protective award was to provide protection for all of the relevant workers (all the workers who would have been represented by the spurned consultee/s.)

(5)	As initially enacted, the protective award provisions were not designed to compensate or to punish.  Instead, they were mainly designed to protect.

19.	When those observations were made by the Dempsey tribunal, they were made without having had the advantage of seeing the 1974 consultation paper which preceded the enactment of the Employment Protection Act 1975.  The purpose of what became the redundancy collective consultation provisions of the EPA was clearly explained at paragraphs 68 and 69 of the Consultation Paper, in the following terms:

“68.  An independent trade union which is recognised or which the CAS has recommended should be recognised should have the right first to request the CAS to conciliate if it is claimed that an employer has failed to consult the union about redundancies; and second, if conciliation by the Service proves ineffective the union could complain to an industrial tribunal that the employer either had not informed the union in time, or had not provided necessary information, or had refused to receive the union’s representations, or had not given a reasoned reply to them.

69.  If the tribunal finds the complaint justified it will issue a determination that effective consultation had not taken place.  The effect of this would be that each individual concerned would become entitled to be treated as if he were employed under a contract containing a term requiring the employer to employ for such period as the tribunal may determine (but not beyond 30 days after the tribunal’s award or after expiry of the period of notification required by paragraph 66 above, whichever is later) during which period he would be entitled to his full wages.  His individual notice of redundancy would take effect only from the date of expiry of the award, a redundancy pay would be calculated accordingly.  If effective consultation takes place during the period, application could be made to the tribunal for the determination to be revoked wholly or in part”.

20.	In my opinion, the quoted extract from the Consultation Paper tends to support propositions (3), (4) and (5) of the relevant Dempsey propositions (as summarised at paragraph 18 above).

21.	Against that background, and for those reasons, I have decided to make a protective award in respect of all of the employees of the respondent who were dismissed by reason of redundancy on, or about, or since, 17 January 2014, and in respect of anybody who is still employed by the respondent, but whom the respondent proposes to dismiss by reason of redundancy in the future.  
            
The specified employees

22.	This protective award applies to all of the following descriptions of employees (“the specified employees”):

(1)	This claimant.

(2)	The claimants in all pending Article 217 industrial tribunal claims against this respondent.

(3)	All of the other employees of the respondent who have been dismissed (by the respondent) as redundant, or whom it is proposed to dismiss as redundant, at any time from 14 January 2014 onwards.

23.	I consider it to be appropriate to specifically include, within the relevant descriptions of employees, all of the “other claimants” (the claimants in all of the pending Northern Ireland industrial tribunals Article 217 complaints, other than the present claimant) because, in each such complaint, the complainant asserts that he or she was dismissed by reason of redundancy, by the respondent, during the period which began on 1 January 2014, and that contention has not been controverted by the respondent.  

24.	Why have I decided to make a protective award in respect of all of the redundant staff, instead of making the award only in respect of this complainant, or instead of making the award only in respect of all of the claimants who have pending Article 217 complaints against this respondent?  For the reasons specified at paragraphs 267-309 of Dempsey.  

25.	The whole tenor, context and purpose of the relevant legislation strongly implies that an Article 217 adjudication, and any consequential protective award, in relation to any particular redundancies process, should be a one-off, once-and-for-all adjudication and award.  

26.	As was explained in Dempsey, the position is as follows.  First, Northern Ireland collective redundancies consultation legislation must be construed in light of the requirements of the relevant Directive.  Secondly, as European case law has clearly shown, the relevant collective redundancies obligations relate to collective rights, as distinct from individual rights.  

27.	Against that background, it is hardly surprising that the relevant Northern Ireland legislation envisages that the complainant will be the spurned consultee, if possible; and that it only allows complaints by individuals, as a proxy means of redress, in circumstances in which no spurned consultee (a recognised trade union or a member of an employee forum) is available to carry out the function of complaining.  

28.	If the individual is a proxy complainant, why should his or her complaint have a narrower scope, in terms of protection or in terms of sanction, than a complaint brought by a preferred complainant, especially in circumstances in which the legislator has not made any obvious steps to make it clear that the relevant remedies are to be so much narrower in the context of a complaint by an individual complainant?  

29.	What is the practical effect of my decision to make such a broadly based protective award?  The effect is to put the employees of the Company in precisely the same position (no better, although also no worse) that they would have been in if either of the following two situations had existed: 

(1)	If a trade union had had collective bargaining in recognition in relation to all of the staff; or

(2)	if there was no recognised trade union, but a workforce-wide employee forum had existed.”

37.	The quoted extract from Glendinning includes a reference to paragraphs 267-309 of an industrial tribunal Decision in Dempsey & Others  v  David Patton & Sons (NI) Ltd (In Administration) [CRN 947/13 & Others, Decision issued on 4 April 2014].  Paragraph 267-309 of Dempsey are set out as an Annex to this Decision.

38.	Dempsey was a decision of an industrial tribunal chaired by myself.  None of the lay members of this tribunal were lay members of the Dempsey tribunal.  

Recoupment Statement

(1)	In the context of this Notice: 

(a)	‘the relevant benefits’ are jobseeker’s allowance, income support and income-related employment and support allowance; and

(b)	any reference to ‘the Regulations’ is a reference to the Employment Protection (Recoupment of allowance and Income Support) Regulations (Northern Ireland) 1996 (as amended).

(2)	Until a protective award is actually made, an employee who is out of work may legitimately claim relevant benefits because, at that time, he or she is not (yet) entitled to a protective award under an award of an industrial tribunal.  However, if and when the tribunal makes a protective award, the Department for Social Development (‘the Department’) can claim back from the employee the amount of any relevant benefit already paid to him or her; and it can do so by requiring the employer to pay that amount to the Department out of any money which would otherwise be due to be paid, to that employee, under the protective award, for the same period.  

(3)	When an industrial tribunal makes a protective award, the employer must send to the Department (within 10 days) full details of any employee involved (name, address, national insurance number and the date, or proposed date, of termination of employment).  That is a requirement of regulation 6 of the Regulations.

(4)	The employer must not pay anything at all (under the protective award) to any such employee unless and until the Department has served on the employer a recoupment notice, or unless or until the Department has told the employer that it is not going to serve any such notice. 

(5)	When the employer receives a recoupment notice, the employer must pay the amount of that recoupment notice to the Department; and must then pay the balance (the remainder of the money due under the protective award) to the employee.
  
(6)	Any such notice will tell the employer how much the Department is claiming from the protective award.  The notice will claim, by way of total or partial recoupment of relevant benefits, the ‘appropriate amount’, which will be computed under paragraph (3) of regulation 8 of the Regulations.

(7)	In the present context, “the appropriate amount” is the lesser of the following two sums:

	(a)	the amount (less any tax or social security contributions which fall to be deducted from it by  the employer) accrued due to the employee in respect of so much of the protected period as falls before the date on which the Department receives from the employer the information required under regulation 6 of the Regulations, or

	(b)	the amount paid by way of, or paid on account of, relevant benefits to the employee for any period which coincides with any part of the protected period falling before the date described in sub-paragraph (a) above.

(8)	The Department must serve a recoupment notice on the employer, or notify the employer that it does not intend to serve such a notice, within ‘the period applicable’ or as soon as practicable thereafter.  (The period applicable is the period ending 21 days after the Department has received from the employer the information required under regulation 6).

(9)	A recoupment notice served on an employer has the following legal effects.  First, it operates as an instruction to the employer to pay (by way of deduction out of the sum due under the award) the recoupable amount to the Department; and it is the legal duty of the employer to comply with the notice.  Secondly, the employer’s duty to comply with the notice does not affect the employer’s obligation to pay any balance (any amount which may be due to the claimant, under the protective award, after the employer has complied with its duties to account to the Department pursuant to the recoupment notice).

(10)	Paragraph (9) of regulation 8 of the 1996 Regulations explicitly provides that the duty imposed on the employer by service of the recoupment notice will not be discharged if the employer pays the recoupable amount to the employee, during the ‘postponement period’ (see regulation 7 of the Regulations) or thereafter, if a recoupment notice is served on the employer during that postponement period.  

(11)	Paragraph (10) of regulation 8 of the 1996 Regulations provides that payment by the employer to the Department under Regulation 8 is to be a complete discharge, in favour of the employer as against the employee, in respect of any sum so paid, but ‘without prejudice to any rights of the employee under regulation 10 [of the  Regulations]’.

(12)	Paragraph (11) of regulation 8 provides that the recoupable amount is to be recoverable by the Department from the employer as a debt.  

Employment Judge:

Date and place of hearing:  9 September 2015, Belfast.

Date decision recorded in register and issued to parties:
Annex to 758/15-766/15

Extract from Dempsey Decision

267.	In each of the relevant cases, we have already decided to make a protective award only in respect of the claimant.  (See paragraphs 88-90 above).  However, in the hope that this may be of assistance to claimants and respondents in future similar cases, we add the following comments in relation to the potential breadth of any protective award made as a consequence of an Article 217 complaint by an individual.  (As noted previously, every relevant provision of the ERO was drafted with a view to reflecting precisely the meaning and purpose of the provision in the relevant GB legislation which corresponds to it.  Accordingly, the following discussion focuses upon the GB legislation).

268.	The 1975 Directive did not explicitly require Member States to provide compensation for workers who were affected by breaches of the collective obligations imposed by that Directive, or to impose penalties in respect of any such breaches.  Even after the amendments effected by the 1992 Directive, Article 5A contained all that the Directive explicitly required.  (See paragraph 211 above).

269.	It is worth noting that the 1975 Directive explicitly imposed two sets of obligations.  First, as already repeatedly noted above, it imposed an obligation upon the employer to inform and consult employee representatives.  Secondly, the Directive also imposed an obligation upon employers to notify “the competent public authority” of any projected collective redundancies.  (See Article 3 of the 1975 Directive, section 193 of TULRA and Article 221 of ERO). 

270.	In the EPA, and in all versions of TULRA (TULRA as originally enacted, TULRA after the 1993 amendments, that Act after the 1995 amendments, and TULRA after the 1999 amendments), the legislator has consistently made provision for the enforcement of the Article 3 notification obligation in a particular way: by making it a criminal offence to fail to notify.  

271.	It would equally have been open to the legislator in Great Britain to have made provision for the enforcement of the consultation obligation (and of the associated, implicit, “election” obligation) by making it a criminal offence to fail to comply.  The legislator chose not to do so.  

272.	It would equally have been open to the GB legislator to have provided for enforcement of the consultation obligation by making provision that dismissals made without compliance with that obligation were to be regarded as null in void.  Again, the legislator chose not to do so.  

273.	Instead, what the legislator did choose to do, in relation to the enforcement of the consultation obligations, was to enact subsections (3) and (4) of section 101 of the EPA.

274.	In TULRA as originally enacted, subsections (3) and (4) of section 101 of the EPA were replaced by subsections (2) and (3) of section 189, which provided as follows: 

	“(2) If the tribunal finds the complaint well-founded it shall make a declaration to that effect and may also make a protective award.

	(3) A protective award is an award in respect of one or more descriptions of employees—

		(a) who have been dismissed as redundant, or whom it is proposed to dismiss as redundant, and

			(b) in respect of whose dismissal or proposed dismissal the employer has failed to comply with a requirement of section 188,

		ordering the employer to pay remuneration for the protected period.”

275.	A textual comparison of the two sets of provisions shows clearly that there is no substantive difference between subsections (2) and (3) of section 101 of EPA on the one hand, and subsections (2) and (3) of section 189 of TULRA on the other hand.  

276.	The 1993 Act did not amend subsections (2) or (3) of section 189 of TULRA.  

277.	The 1995 amendments did not amend those subsections either.  

278.	The 1999 amendments did not amend those subsections either.  

279.   In section 101(4) of the EPA, there was a reference to a protective award being an award “... in respect of such descriptions of employees as may be specified in the award ...”.  [Our emphasis]. Why that reference to “descriptions”?  In our view, section 104(4) referred to descriptions because:

(1)	That subsection, in effect, provided that a protective award could  be made  in respect of an employee  only if the employer had failed,  in relation to that employee’s dismissal,  to comply with the section 99 consultation  obligations; and

(2)	section 99(1) imposed those obligations only in respect of employees “of a description in respect of which an independent trade union is recognised by [the employer] ...” [Our emphasis]. 

280.   The phrase “... an employee of a description in respect of which an independent trade union is recognised  ...” also appeared in section 188(1) of TULRA, as originally enacted.  

281.	That phrase was unaffected by the 1993 Act’s amendments.  

282.	At this point, it is worth recalling the context in which individual complainants were first allowed (by the 1995 Regulations).  That context was as follows.  Prior to the 1995 amendments, only a recognised trade union could invoke the complaints mechanism.  One of the innovations of the 1995 amendments was to allow an “employee representative” or (in the event of there being no trade union or employee representative) an individual to invoke the complaints mechanism.  The 1999 amendments continued to allow for the invocation of the complaints-mechanism at the behest of a union, an employee representative or an individual.  (The 1999 Regulations merely changed the order in which such a right of standing became available).  

283.	New subsections (1) and (1B) of section 188 of TULRA were substituted by the 1995 regulations.  As so substituted, the new subsections (1) and (1B) were in the following terms:

		“(1) 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 so dismissed. 

			(1A) ...

			(1B) For the purposes of this section the appropriate representatives of 	any employees are— 

				(a) employee representatives elected by them, or

			(b) if the employees are of a description in respect of which an independent trade union is recognised by the employer, representatives of the trade union,

	or (in the case of employees who both elect employee representatives and are of such a description) either employee representatives elected by them or representatives of the trade union, as the employer chooses.

		...”

284.	It will be noted that, as a result of the 1995 amendments, the obligation to consult is now owed not just in relation to the representatives of potentially or actually redundant employees in respect of which an independent trade union is recognised for collective bargaining purposes: instead, from 1995 onwards, that obligation to consult is imposed in relation to all the representatives of all potentially or actually redundant employees (provided, of course, that the quantitative criterion, imposed in the post-1995 section 188(1), is satisfied).

285.	Nobody doubts that, if a trade union invokes the complaints mechanism, and a tribunal as a result decides to make a protective award, that tribunal is under an obligation to make that award at a uniform level (in terms of the number of weeks of award), and that it has power to do so in respect of all of the actual or proposed dismissed employees in respect of whom the relevant union had collective bargaining entitlement.  

286.	Nobody doubts that, if an “employee representative” invokes the complaints- mechanism, and a tribunal, as a result, decides to make a protective award, that award has to be made at a uniform level in terms of number of weeks and can be made in respect of all of those employees who were within the scope of the representation provided by the relevant pre-existing or ad hoc employee forum.  

287.	Why should the position be different merely because the complaints mechanism is being invoked by an individual, as a last resort (because of the fact that there is no recognised trade union for collective bargaining purposes, and because of the fact that there are no “employee representatives” within the meaning of the relevant provisions of TULRA)?  Why, in those circumstances, should the scope of the protective award be much narrower than it would have been if the complaints mechanism had been invoked by a trade union or an employee representative?

288.	The wording of subsection (3) of section 189 of TULRA, which defines the scope of the protective award, was not changed in 1995, when the 1995 Regulations allowed, for the first time, for the invocation of the complaints-mechanism by an individual.  Furthermore, the 1999 amendments made no change to the wording of that subsection.  

289.	Accordingly, the wording and history of the legislation does not, on the face of it, provide any support for the proposition that the scope of a protective award is narrower in the event of the complaints-mechanism having been invoked by an individual (as distinct from having been invoked by a trade union or an “employee representative”). 

290.	In future cases, involving future redundancy processes, it seems to us that it would be open to an individual complainant, in some circumstances, to validly argue that his or her Article 217 complaint could, and perhaps should, result in the making of a protective award in relation to all of the staff of the relevant employer who are potentially or actually redundant (as distinct from the making of an award only in relation to that particular complainant).  We make that observation, in light, in particular, of the following matters.  

291.	First, a section 189 complaint is clearly collective in nature, as the European Court of Justice emphasised during the course of the Mono Car case.  (See paragraph 129 above).  

292.	Secondly, as Peter Gibson LJ observed in Susie Radin Ltd v GMB [2004] IRLR 400 (at sub-paragraphs (5) and (6) of paragraph 24 of the judgment):

“(5) The protective award is expressed to be in respect of one or more descriptions of employees affected, rather than in respect of individuals; it is a collective award.
(6) That the particular circumstances of individuals are not the focus of attention in the statutory provisions is also brought out by the fact that the protected period begins with the date on which the first of the dismissals to which the complaint relates takes effect (unless the date of the protective award is earlier) and that the limitation period for bringing a complaint under s. 189 is defined by reference to the date on which the last of the dismissals to which the complaint relates takes effect, regardless of the dates on which the dismissals of others to whom the complaint refers take effect.”
293.	Thirdly, in Smith v Cherry Lewis Ltd  (in receivership) [2005] IRLR 86, individual employees made a section 189 complaint and asked for a protective award.  That request was refused by the employment tribunal, on the basis, according to the tribunal, that it would not be appropriate, in view of the employer’s insolvency, to make a protective award.  The Employment Appeal Tribunal (Mrs Justice Cox) allowed the appeals and went on to make the order for a protective award which, in the opinion of the EAT, the employment tribunal should have made.  It made that award, in relation to the individual claimants who had made the complaint, but then went on to make the following additional protective award:

“In addition, and pursuant to the provisions of section 189(3) of the 1992 Act, there should be a protective award paid in respect of such hourly and/or weekly and/or monthly paid employees of the respondents, who were dismissed on or after 11 December 2003, whereby subject to ss. 190 and 191, the respondents are ordered to pay remuneration to each such employee for their protected period, which shall, in respect of each such employee, be the period of 90 days”.  

294.	Fourthly, the whole point about an Article 189 complaint is that it allows for a once- and-for-all adjudication, on the part of the employment tribunal (as the competent judicial authority) on the question of whether or not, in relation to any particular redundancy programme, the consultation and election duties have, or have not, been complied with.  It is not helpful to an employer, or to workers’ representatives, if different tribunals arrive at different conclusions on the same question.  

295.	Fifthly, section 190(1) of TULRA, which is in the following terms, applies even in relation to section 189 complaints made by individuals:  

“(1) Where an industrial tribunal has made a protective award, every employee of a description to which the award relates is entitled, subject to the following provisions and to section 191, to be paid remuneration by his employer for the protected period.”

	Why in the context of a section 189 complaint by an individual, would section 190(1) be needed at all, if, in such a context, a protective award could only ever apply to that particular complainant?

296.	At paragraph 90 above, we have already referred to the Aspinall case.  

297.	In Great Britain, the decision of the Employment Appeal Tribunal in that case is authority for the proposition that, where an individual claimant seeks a protective award under section 189 of TULRA, a tribunal only has jurisdiction to make an award in his or her favour, and cannot make an award that benefits other redundant employees.

298.	That case was an appeal by the respondent employer from a decision of an employment tribunal, presided over by Regional Employment Judge Doyle.  In that case, the employment tribunal had decided that, in circumstances where sections 188 to 189 of TULRA applied, and in which there was no trade union representative and no elected representative of the employees affected by possible redundancy, one affected employee could seek a protective award, not only for himself, but for all other persons similarly affected.  Upon appeal, that determination was overturned by the EAT.

299.	The reasoning of the employment tribunal was set out at paragraphs 20-24 of the judgment of the EAT:

		“20.	At paragraph 16, the Employment Tribunal stated: 
 
		“The Tribunal does not accept that section 189(1) describes what might be termed a ‘representative action’: that is, one that can only be brought by certain persons on behalf of and for the benefit of a wider group.  Section 189(1) simply describes who may bring a complaint of a breach of section 188 and 188A.  It means simply that where there are trade union representatives, they must bring the complaint. Where there are no trade union representatives, but there are elected or appointed representatives, they must bring the complaint.  Where there are neither trade union representatives nor elected or appointed representatives then any other relevant employee may bring the complaint.  A relevant employee is an affected employee or an employee who has been dismissed as redundant. That is the distinction to which the Court of Appeal is referring in Northgate HR Ltd v Mercy [2008] CR 410 at para 15”  
 
		21.	The Employment Tribunal went on to say:
 
		“17. Once the Tribunal is satisfied that the claimants have the status to bring the complaint, and that the duty to consult has not been complied with, then, if it finds the complaint to be well founded, it shall make a declaration to that effect and it may make a protective award (section 189(2)).  

		18. Section 189(3) then defines what a protective award comprises.  It is an award in respect of one or more descriptions of employees who have been dismissed as redundant (etc) and in respect of whose dismissals (etc) the employer has failed to comply with a requirement of section 188.”  
 
	22.	At paragraph 19, the Employment Tribunal rejected the submission that it only had jurisdiction to make a protective award in respect of a person who has been dismissed as redundant where a complaint has been proved in respect of that person.  The Employment Tribunal stated that that was not what section 189(3), read in the context of sections 188 to 189, says.  This was contrary to the views expressed by the learned editors of Harvey on Industrial Relations, to which we shall turn shortly, at paragraph 2757.  The Employment Tribunal considered that the commentary in Harvey, based upon the case of Transport & General Workers Union v Brauer Coley, was not supported by that case, which was distinguishable.
 
	23.	The Employment Tribunal stated that that is not what the Employment Appeal Tribunal appeared to be stating as a principle in that case:
 
			“Trade union representatives can only bring a complaint in respect of affected employees or dismissed employees covered by the collective bargaining unit in question.  The protective award can only extend in such a case to employees covered by the collective bargaining unit, whether they are trade union members or not, and it cannot extend to employees beyond the bargaining unit (in respect of which there might well be other trade union representatives, or appointed or elected representatives, who have separate and exclusive standing to bring a complaint that might lead to a protective award covering employees outside the bargaining unit in question).  It does not appear to the Tribunal that Brauer Coley is an authority for any wider proposition.”  
 
		It went on to say that if the Employment Tribunal was precluded of making such an award they would have expected Parliament to have said so in clear terms.
 
	24.	At paragraph 22 the Tribunal did not consider it could properly interpret the provisions of sections 188 and 189 by having regard to the practical consequences of the approach to which it feels committed by an orthodox reading of the statutory language:
 
			“The Respondent invites the Tribunal to take account of what must have been (or could not have been) Parliament’s intention by reference to practical examples given at paragraph 25 of the skeleton argument.  However, if the wording of the statutory provision is clear and unambiguous, as it appears to the Tribunal to be, it is not for us to divine Parliament’s intention further.”  
 
		In his submissions before us, Mr Gatt has persuasively submitted that that approach to construction is seriously flawed.”

300.	The EAT’s conclusions on the appeal were set out at paragraphs 48-52 of its judgment:

	“48.	We now turn to our conclusions.  I do not propose to refer to all of the arguments but I will concentrate on the principal points.  So far as the law is concerned, the statutory architecture of sections 188, 188A and 189 is to give representative rights to trade unions and elected representatives only.  Only they may apply to enforce those rights.  I am told by my lay members that as a matter of practice an employer will negotiate with a trade union representative for everybody in its constituency whether they are members of the trade union or not and similarly with employee representatives.
 
	49.	We note the descriptions of the constituencies of the trade union and the employee representatives to which we have referred.  It would be an amazing sea change in the legislation if a right of an individual gave that individual greater representative status than the trade union or the elected representative so that he could effectively make a claim for all persons affected by the redundancy in a wider pool than the constituency represented by the trade union or the elected representative, and that this had been achieved by Parliament without any debate, without the insertion of any provisions for notice or for the election or approval by the class said to have been represented, no procedure provided in respect of potential claimants whose claims had been dismissed, settled or not made.  Mr Gatt submitted that you would expect at least very clear words in the statute to create such a right rather than the opposite as suggested by the Employment Tribunal where clear words should be required to exclude such a right.  This case is a good example of the anomalies that arise if the decision of the Employment Tribunal is correct.  All potential beneficiaries save three have had their claims settled, struck out, dismissed or claims were never made in the nine-year period since the redundancies.
 
	50.	We have referred earlier to the relevant statutes.  We have referred to Transport & General Workers Union v Brauer Coley.  If the statute were to be construed as the Employment Tribunal had construed it, there was no reason why in that case the trade union could not have obtained an award for the benefit of the wider class, including those it did not represent.  We are satisfied that Harvey is correct.  We are satisfied that the speech of Lord Blackburn in the River Wear case is apposite and that this statute must be construed in its context and to have regard to the fact that Parliament would not have intended to produce an absurd result.  We do not think that Parliament could have intended these anomalies.
 
	51.	If a trade union cannot make a claim in respect of members who are not represented in a particular workplace but are similarly affected, how could an individual without notice to other claimants and the employer and in respect of claimants to whom it owes no duties and has no authority to act and in many cases would be unlikely to know about the claim at all?  In the particular case with which we are faced, it was necessary for the Employment Appeal Tribunal to direct the Respondent to advertise for potential beneficiaries in a newspaper.  Only one came forward.  It would be impossible for an employer to defend proceedings as it might find itself potentially liable to pay an award to all persons affected; in this particular case over 350.  It would be impossible for the employer to consider what defences it might have, for example, in the special circumstances defence, that might arise in relation to different individual employees or groups of employees.  It would be a wholly unprecedented widening of the scope of representative actions without there being any safeguards.
 
	52.	The Employment Tribunal, as we have said, was aware at the review of the number of people in Cheadle affected.  It was aware that 100 or so had claims settled, 100 or so had not presented complaints, and I think 100 had accepted payment under the settlement approved by the Companies Court, which included payments for protective awards, and the large number who had not made any claim since 29 June 2001.  The effect of the decision is hopelessly anomalous as we have said because it would enable persons to benefit from the judgment whose cases to which we have referred that have been dismissed, struck out or have not been brought to benefit, even those cases where the employees had failed to establish a breach.  Could it be right, for example, that different applicants in a group can go on raising a claim round the country before different tribunals and different employment judges until one of them hits the jackpot and succeeds, in which case everybody else whose claims may have already failed or been struck out will be able to cash them in, in the language of Burton J.  We find it wholly anomalous that an individual claimant would have greater rights than a trade union or elected representative but no corresponding duties; for example, no obligation to consult with the employer on behalf of his constituency.  Why should anyone settle a case if the liability can be extended by subsequent successful claim by an individual claimant?  The legislative history suggests that it was intended that the right should be limited to those persons who were represented by a trade union or employer only, or to claim in their own right only.  That is the effect of the passage in Harvey to which we have referred and the Transport & General Workers Union case which we have referred to.”

301.	We find the reasoning of the employment tribunal in Aspinall to be entirely convincing.  We find the reasoning of the Employment Appeal Tribunal in that case to be much less so.

302.	The EAT’s conclusions seem to be based, to a considerable extent, on its view that section 189 proceedings are “representative” proceedings in the sense in which that term is used in the context of the English Civil Procedure Rules.  That is incorrect.  Instead, section 189 complaints are more analogous to regulatory interventions, such as those provided for under section 35 of the Fair Trading Act 1973 or those provided for under Regulation 12 of the Unfair Contract Terms Consumer Contract Regulations 1999.

303.	A section 189 complainant is more like an informant than a potential beneficiary.  Indeed, if an individual section 189 complainant is not at risk of being made redundant, he or she cannot even potentially benefit from the making of any protective award pursuant to his or her complaint.  (Any employee “affected” by the proposed redundancies can make the complaint).

304.	If a trade union is recognised in relation to a workforce, or part of a workforce, which is the subject of a large scale redundancies programme, the employer’s obligation is to consult with that trade union.  Accordingly, it is of course appropriate that any failure to consult with that consultee should be the subject of complaint by that particular consultee.

305.	If there is no recognised trade union in relation to the relevant workforce, or the relevant part of a workforce, employee representatives are the appropriate consultees (under section 188(1) of TULRA).  Accordingly, it is entirely appropriate that, if such consultation does not take place, the complainant in respect of that lack of consultation, is one of those spurned consultees.  (However, it is noteworthy that in that situation, the complaint clearly can be made by any of those spurned consultees and that any of them can make a complaint without obtaining the approval of other employee representatives).

306.	Since the 1995 amendments, section 189 has allowed an individual to initiate a section 189 complaint, but only as a last resort (only if there is no trade union and no employee representatives).  The only purpose of allowing individual complainants was to provide a means of bringing complaints to the attention of the appropriate judicial authority (the employment tribunal) in situations in which appropriate representatives are not available to do so.

307.	Finally, we go back to the purposes of protective awards (as already discussed at paragraphs 158 and 168 above).  

308.	One of the main purposes of a protective award is to protect those who otherwise would be the victims of unduly hasty dismissals, within a context in which adequate consultation had not taken place.  Why should it not be possible, for an affected individual employee, to invoke the protection of the legislation, in respect of everybody who would otherwise be at risk, in a situation in which workers’ representatives are not available to invoke that protection?

309.	The second main purpose of a protective award is to provide effective sanctions in respect of breaches of the section 188(1) and section 188A obligations.  Surely that purpose is not undermined if the scope of a protective award is the same, regardless of the identity of the particular section 189 complainant?