Unfair dismissal?

zaksmum

If a company goes into administration and all (long serving) staff are dismissed without notice "on economic grounds", would there be a claim for a basic award on grounds of unfair dismissal?

I have looked on the government website detailing an employee's rights when a company goes into administration and it does appear to suggest this is the case.

antrobus

Technically speaking, the failure to follow proper redundancy procedures might give rise to a claim for unfair dismissal. But then the company is in administration, and there is a general rule of law that you only sue people who have the money to pay you should you win.

getmore4less

Its a redundancy which is a fair termination.

zzzLazyDaisy

The basic award is calculated in exactly the same way as a statutory redundancy payment. You can't have both (if you get a statutory redundancy payment and then successfully claim unfair dismissal the SRP is deducted from the award).

The way to deal with it is to claim the redundancy payment, notice pay, outstanding holiday pay and outstanding wages (subject to limits) from the Redundancy Payments Service.

But sign on immediately, because the JSA payments are deducted from any notice pay owed, as you have a duty to mitigate your loss.

zaksmum

Thanks antrobus, getmoreforless and zzzLazyDaisy. The redundancy pay documents have been sent along with the claim for holiday pay and outstanding wages.

The documents say the notice pay can't be claimed till the 90 days notice period has elapsed though.

Is this correct?

zzzLazyDaisy

This might help to explain things

http://www.bis.gov.uk/assets/insolvency/docs/forms/redundancy-payments/urn12-561-rp1-fact-sheet

You cannot claim the notice pay until after the end of the notice period. For a long serving employee that could be 12 weeks (which I presume is what you are referring to?). This is because of the duty to mitigate. Any JSA claimable during that period will be deducted from the payment (even if it is not claimed). As far as I know any earnings during that period are also deducted for the relevant weeks. This would be the same if you went to tribunal for unpaid notice pay.

The rational is that the entitlement is the right to be given notice that your employment will end in (say) 12 weeks time and to continue working and earning during that time. Where this does not happen a pay 'in lieu' of that notice is made. But that is effectively compensation for the wages you would have earned had you need allowed to work your notice. So if you get another job or JSA during that period, that is money you could not have had if you had been in work for the duration of the notice period, as you would not have been available. So it is not the lump sum payment on lieu of notice that is the statutory right, but the difference between your income during those weeks and what you would have earned if you had been working (bearing in mind that a week's wage is subject to the statutory cap).

Since this information cannot be known until the notice period has expired, the RPS will send out form RP2 at the end of the notice period to claim any money owing in relation to the notice pay.

Sorry if this sounds convoluted. I have tried to explain it in understandable terms, but it does often cause confusion.

D

superbigal36

Of course if they were supposed to give a 30 or 90 days consultation period you can still file for unfair dismissal.
Any award will clearly come from the same place as the RP1 and is limited to what can be actually paid.
I think I got 90 days awarded from Tribunal (dont end up with that) and applied to all employees in same boat. It certainly meant we got more than originally through the RP1.
I had a lot of very happy ex-colleagues buying me bottles of allsorts.
I believe 30,000 woolies staff benefited for this reason.

zaksmum

superbigal36 wrote: »

Of course if they were supposed to give a 30 or 90 days consultation period you can still file for unfair dismissal.
Any award will clearly come from the same place as the RP1 and is limited to what can be actually paid.
I think I got 90 days awarded from Tribunal (dont end up with that) and applied to all employees in same boat. It certainly meant we got more than originally through the RP1.
I had a lot of very happy ex-colleagues buying me bottles of allsorts.
I believe 30,000 woolies staff benefited for this reason.

Ok, now I'm confused! Are you saying that a claim for unfair dismissal can be made even when you are ALSO claiming redundancy money and notice pay from the Redundancy Payments Office as the company has gone into administration?

superbigal36

Yes technically the administrator is supposed to use the same redundancy process as any employer. If they dont you can take them to tribunal. They wont defend your action. Unfortunately there will be no money to actually pay the award so the government pot comes in again.
There are limits though the government pot can pay out and a certain deduction is made because of your statutory notice.
This purely memory but I think the govt pays up to 8 weeks max minus any notice period paid through redundancy. All at the £430 per week or whatever current maximum is.
I remember me and another 25+ employees were awarded 90 days pay. We then actually got 8x£430 - 4x£430 (Notice already paid). This through memory although I do have the tribunal award somewhere.
It was a weird experience as I was the only person with the "nouse" to have claimed. There was me a Judge and a note taker in the court. I asked the Judge if he could apply the award to all staff and he wrote that in his judgement. Hence my popularity.

zaksmum

Thanks for this superbigal. What would the timescale be? So far it's been...made redundant Feb 8th without notice. Monthly wage due Feb 15th not paid. Made a claim for JSA Feb 11th. Completed and returned Redundancy and unpaid wages/holiday pay claim form Feb 12th.

At what point would the unfair dismissal claim be initiated please?

The period of employment with the employer was 25 years.

superbigal36

Make your clain online immediately.
Note there must have been over 20 people made redundant by the administrator.

Consultation should begin in good time and must begin:

• at least 30 days before the first dismissal takes effect if 20 to 99 employees are to be made redundant at one establishment over a period of 90 days or less
• at least 90 days before the first dismissal takes effect if 100 or more employees are to be made redundant at one establishment over a period of 90 days or less.