T.M Lewin to pay its workers £439,000 after losing employment lawsuit.

Before employees can be made redundant in certain circumstances, consultation is legally required and involves a specific process which must be followed.

If you’re an employer and you are not sure whether you need to consult your employees in your situation, you could choose to carry out consultation anyway to help avoid any risks. You should get legal advice from a competent and reputable firm if you want to check if it will be a legal requirement.

‘Collective consultation’ refers to when an employer consults with a recognised trade union or employee representatives.

The law states that an employer must collectively consult if they propose to dismiss and rehire or plan to make redundant 20 or more employees:

• at one establishment;
• within a period of 90 days or less.

Employers must collectively consult to explore how to:

• avoid the dismissals or redundancies;
• reduce the number of dismissals or redundancies;
• limit the consequences of the dismissals or redundancies within the organisation.

The law says employers must start this consultation ‘in good time’. What counts as ‘in good time’ will depend on the circumstances of each company’s situation. However, they must start consultation for:

• 20 to 99 employees – at least 30 days before the first proposed dismissal or redundancy
• 100 or more employees – at least 45 days before the first proposed dismissal or redundancy

If employers do not meet collective consultation requirements, employees can make a claim to an employment tribunal and if the claim is successful, employers might have to pay their employee or employees compensation (a ‘protective award’), which can be up to 90 days’ full pay for each affected employee.

Clothing retailer T.M. Lewin now faces a lengthy legal battle over claims it was required to consult employees before firing them, after an employment tribunal told it to pay out a total of £439,000 to more than 100 of its former staff.

This came after an employment tribunal ruled that T.M. Lewin is liable to pay former staff as much as £4,352 each, over its failure to properly consult its workers, before firing 600 employees in June 2020.

More than one hundred former T.M. Lewin employees could be eligible to receive pay-outs worth £4,352 each, after 101 workers won a £439,000 lawsuit against the firm.

The employment tribunal ruled in favour of the workers, in stating the formalwear retailer failed to properly consult employees – in line with rules stating companies must carry out a 45-day long consultation period in situations in which they are firing more than 100 employees.

However, this ruling may be overturned in higher courts, as previous case law may fall on T.M. Lewin’s side.

T.M. Lewin may be able to overturn the ruling, by arguing that it was not required to consult its staff, as none of its individual stores had enough staff to trigger the consultation requirements.

For further advice and assistance please contact our Employment Solicitors on 01604 828282 / 01908 660966 or email info@franklins-sols.co.uk