Labour Research (August 2015)

Law Queries

Redundancy consultation

Q. Our employer carried out 25 redundancies without realising that they were obliged to consult collectively with employee reps (no union is recognised). Now they say they shouldn’t have to pay a protective award because even if they’d realised it at the time, they wouldn’t have consulted due to “special circumstances” — the fact that the business was nearing collapse. Are they right?

A. No. It is correct that under the Trade Union and Labour Relations Consolidation Act 1992, employers who fail to comply with their duty to consult collectively have a defence if they can point to “special circumstances” that made it not reasonably practicable to consult.

This is not an absolute defence, because the employer must show that it did everything reasonably possible to consult in the time available.

However this defence is not available to your employer. Only employers who actively consider their consultation duties at the correct time can rely on the defence of “special circumstances”.

Employers who, for whatever reason, fail to appreciate that they were supposed to consult are not entitled to rely on this defence “after the event”. This was established in a recent case, E Ivor Hughes Educational Foundation v Morris [2015] UKEAT/0023/15/LA. As your employer failed to consult at all, it is likely to be subject to the maximum award of 90 days’ pay.

Finally, special circumstances must be something unforeseen and unexpected. Insolvency is not a special circumstance entitling the employer to avoid consulting.


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