Usdaw members at Ethel Austin receive pay-put after union challenges Ethel Austin redundancy

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Usdaw has won compensation worth up to £1.5 million for over 500 former employees of Ethel Austin who were made redundant by administrators in 2010.

Ethel Austin went into administration on 8 February 2010 and Usdaw made a claim on behalf of its members for a Protective Award after administrators MCR failed to consult with the union before making 1,700 staff redundant.

The Employment Tribunal in Liverpool found MCR had failed in their legal obligations to consult with Usdaw and awarded its members compensation of eight weeks pay, capped at £380 a week, the maximum payable in these circumstances.

The compensation is limited to those employees made redundant from Ethel Austin’s former Head Office and Distribution Centre in Knowsley and the company’s store in Edgware London. In a judgment the union may appeal, the tribunal decided that MCR was not obliged to consult about workplaces where less than 20 redundancies were being made, thus ruling out all but one of the186 Ethel Austin stores that were closed.

The Ethel Austin brand recently returned to the high street following the purchase of its successor company Life & Style by Ashloch Limited.

National officer John Gorle said: “While the award can never fully compensate for staff losing their jobs, I’m sure our members will welcome the money and appreciate the effort we have made to secure this compensation for them. Cases like these really demonstrate the value of belonging to a trade union.

“However, I’m bitterly disappointed the tribunal limited the scope of the award. The fact that many of our members won’t be compensated just because their store had less than 20 staff is plainly wrong and shows the gaping loophole and injustice of the current legislation. 1,700 employees were made redundant from the same company for the same reason so to suggest only 500 of them constituted a collective redundancy is nonsense.

“We believe the UK’s current interpretation of the law on collective redundancies is both unfair and possibly a breach of the European Directive which seeks to protect workers in large scale redundancy situations. We are taking further expert legal advice and if we can appeal against the judgment we will do so.”


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