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LELR Issue 115 (October 2006)
In the News
Sick Note
Reasonably Adjusted
You're How Old?
Religious Regulation
Caught by COT3
Blow your Whistle
Giving Notice
Section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 states that employers have to consult with unions (and stipulates the time scale in which it must happen) before going ahead with any redundancies.
In Vauxhall Motors Ltd v Transport and General Workers Union (2006, IRLR 674), the Employment Appeal Tribunal (EAT) said that although section 188 does not have an unlimited shelf life, employers do not have to issue fresh notices if a subsequent consultation relates to the same employees and the same prospective redundancies.
In 2002, the company hired hundreds of temporary workers on fixed term contracts. In January 2003, it notified the DTI that it would be making 400 of them redundant between 25 April and 5 September. It also sent the information required under TULRCA to the union.
Following consultations with the union, no one was made redundant in 2003, but in March 2004 the company, without informing the union, requested and received a six-month extension to the application registered with the DTI in January 2003.
In September, the company told the union there would be no compulsory redundancies, but lodged a new notification with the DTI of 345 potential redundancies between October 2004 and September 2005. It did not give the union a copy.
In October 2004, over 300 redundancies were announced at Ellesmere Port. The trade union side argued that the remaining temporary employees (of whom only about 46 remained) should be joined with the other employees affected by the proposed restructuring.
The company argued that it could rely on the statutory information supplied to the union in January 2003, and dismissed the 46 temporary employees on 26 November 2004. The union argued that the company had breached its section 188 obligations.
Section 188, TULRCA says:
(1) An employer proposing to dismiss as redundant an employee of a description in respect of which an independent trade union is recognised by him shall consult representatives of the union about the dismissal in accordance with this section.
(2) The consultation must begin at the earliest opportunity, and in any event–
(a) where the employer is proposing to dismiss as redundant 100 or more employees at one establishment within a period of 90 days or less, at least 90 days before the first of those dismissals takes effect;
(b) where the employer is proposing to dismiss as redundant at least 10 but less than 100 employees at one establishment within a period of 30 days or less, at least 30 days before the first of those dismissals takes effect.
And the tribunal agreed. It said that “a redundancy situation cannot be an on-going piece of elastic as the respondent would wish it in this case. …We do not accept the submission of the respondents that Section 188 offers an “unlimited shelf-life”.
The tribunal went on to find that the company had not consulted meaningfully with the union after 27 September 2004, nor had it sent the union the mandatory information required by section 188(4). It ordered the company to pay a 70-day protective award in favour of the 46 dismissed employees.
Although the EAT agreed with the tribunal that section 188 did not provide an unlimited shelf-life, it did not agree that it had been exhausted in this case. Instead it said that, provided the consultation deals with the same employees and the same prospective redundancies, the employer would not be in breach of section 188.
In this case, there had been an on-going dialogue about the status, extension and transfer of the temporary employees from February 2003 until the dismissals in November 2004. The entire consultation process had therefore continued seamlessly. The elastic did not break and a fresh section 188 process was not triggered.
It also said that the reference in section 188 to a period of 90 days did not mean that if the process of consultation extended beyond that period, it then had to restart. The 90-day period fixed the start of consultation, not the end.