EAT finds that Carillion got it wrong in failing to consult with their staff

An important judgement has recently been handed down by the Employment Appeals Tribunal (EAT). In this case, involving Carillion Services Ltd and their failure to collectedly consult with their staff prior to their sudden closure back in January 2018. 

Carillion had been struggling for some time financially, prior to entering into compulsory liquidation. However, rather than consulting with staff in good time on this, as is required under the legislation for redundancy dismissals, the staff were not informed of the issues until their projects were closed down overnight. 

Finding against Carillion, the EAT rejected their argument that there were ‘special circumstances’ at play that prevented them from consulting properly. For Carillion, it was argued that the time immediately prior to the liquidation was a ‘sudden and unforeseen disaster’ when the government refused support or financial help, and short-term lending arrangements fell through. It was found however that the situation did not suddenly arise, nor was it uncommon or out of the ordinary. As such, there was no good reason why it was not reasonably practicable for meaningful consultation to take place. 

This case was not a matter of just consulting to avoid redundancies, as that was unlikely. Collective consultation also obliges employers to provide information on things such as the reasons behind the redundancies, how dismissals would be carried out and how redundancy payments would be calculated. This is all valuable information to employees facing losing their jobs and it was not provided as it should have been. This was contrary to the law, and unfair to the 1,000 employers who were affected by this.

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