Unite, the UK’s largest union, has launched legal action on behalf of a group of 27 members who were made redundant following the collapse of the Carillion group in January. The legal action is the first taken by a union for affected workers, following the group’s collapse.
Unite’s members were employed by Carillion’s group company Planned Maintenance Engineering Limited on a contract at GCHQ the government’s listening headquarters in Cheltenham, Gloucestershire.
Their company went into compulsory liquidation on 15 January and on 23 January the 80 strong workforce was informed by the liquidators PriceWaterhouseCoopers (PWC) that they faced redundancy, that there was no recognised union and they would be organising the election of employee reps to consult on the proposed redundancies.
The workers were dismissed on 6 February, without consultation and told to claim their redundancy pay from the government’s redundancy payments office. Unite members were then taken on by G4S. As their section of Carillion was in compulsory liquidation, the normal Transfer of Undertakings Protection of Employment (TUPE) regulations did not apply so the workers’ employment and terms and conditions weren’t protected.
Unite Legal Services lodged the claim on behalf of its members in early June, for a failure to comply with the legal obligation to carry out collective consultation before making members redundant. As the company was in compulsory liquidation, Unite has had to apply to the court in order for the claim to proceed and Unite is currently awaiting a response from the Official Receiver in relation to this.
Unite assistant general secretary for legal services, Howard Beckett, said: “Unite is fulfilling its promise of using all avenues including its legal arm to defend our members who are the innocent victims of Carillion’s collapse.
“The complexity of this case, which combines employment law rights and draconian insolvency law requirements, demonstrates why workers need to be part of a union, it would have been simply impossible for individual workers to pursue such a case.
“If our members are successful then once again it is the taxpayers who are going to have to pick up the bill for Carillion’s failings. This again underlines that the outsourcing model is broken beyond repair and needs to be scrapped.”
The claim is against the Carillion employing company, but the tribunal judge has also added in the Secretary of State of Business, Energy and Industrial Strategy (BEIS) as an additional respondent to the claim as it is their agency, the Insolvency Service, which will have to pay the members if the claim is successful.
If successful the workers can each be awarded up to 90 days’ pay, however as Carillion is in liquidation this would be paid by the Insolvency Service in the form of unpaid wages and would be capped at 8 weeks and a maximum weekly amount of £489.
It remains unclear whether Carillion/PWC will seek to defend the claim, which will simply increase their legal bills and further reduce the amount of money Carillion’s creditors will receive.