Partner Sue Dowling, head of our Employment Law team, follows on from part 1, to explain who “Appropriate Representatives are and who an employer must consult in multiple redundancy situations.
As a reminder… “where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less,” statutory collective consultation requirements are triggered. "The required consultation (with “appropriate representatives”) must be “in good time and in any event - where the employer is proposing to dismiss 100 or more employees… at least 45 days, and otherwise at least 30 days” – before any dismissal takes effect (Section 188 - 194 Trade Union & Labour Relations (Consolidation) Act 1992 (TULRCA).
Our part 1 blog article, (and part of a series on Collective Consultation) have guidance as to the requirements of Collective Consultation under the above section including:
- Who are “Appropriate Representatives” (A-Reps)?
- What does an employer do if there are no “Appropriate Representatives”?
In this part 2 we will cover:
- What does the employer need to consult about?
- When must Collective Consultation commence and how long must it last?
It should however be remembered that these provisions of TULRCA are complex and the following guidance should not be used as a substitute for taking specific legal advice, particularly as the precise application of the statutory requirements in practice will invariably depend on the particular circumstances facing a particular employer and the nature of its workforce.
What does the employer need to consult about and to what purpose?
Section 188 essentially provides for a two stage process – the first, relates to the need to provide certain information to the A-Reps; the second relates to consultation, “with a view to reaching agreement” about certain matters. Where the employer fails to view consultation and fails to engage with the need to consult with the right purpose, it may risk facing costly “protective” awards down the line.
Provision of information
Section 188(4) essentially sets out a ‘shopping list’ of minimum information which must be provided in writing to the A-Reps – see the gov.uk website.
The information is largely what one would expect to be provided to enable meaningful consultation to take place – so for example it includes the rationale behind the proposed dismissals/numbers of employees involved/selection methodology/timings etc… However, it goes beyond this (for example requiring potentially wide information to be provided concerning the employer’s use of Agency Workers in its whole business) and the best advice is to work to the letter of the statutory list so that nothing is missed out. In terms of the practicalities, the written information may either be delivered to the A-Reps individually; sent by post to an address notified by them to the employer or, in the case of Trade Union Representatives, posted to the Union's head or main office.
Where an employer cannot provide all of the information listed in one go, it can provide it in stages provided that it does provide sufficient information to enable meaningful consultation to take place. This is entirely logical as some information may not necessarily be available or sufficiently finalised at the outset, and may emerge as the consultation proceeds. Further the information to be provided may be influenced by the input from the A-Reps. The obligation is also a continuing one (throughout the consultation period) rather than being a one-off requirement. In terms of the level of detail to be provided, the information need not be over-refined but should not be scant. The overriding factor is that the information must be genuine, sufficiently adequate; intelligible, and provided in good faith to enable the A-Reps an adequate opportunity to fully understand the issues about which they are being consulted on behalf of the affected employees.
Consultation
Having been provided with the necessary information, consultation must then take place. This must be conducted "with a view to reaching agreement” with A-Reps, and must include consultation about ways of avoiding the dismissals; reducing the number of employees to be dismissed; and mitigating the consequences of the dismissals. Through case law, appropriate consultation will typically:
- Be conducted when the proposals are still at a formative stage, with the employer adopting an open-mind and with a willingness (where appropriate) to be persuaded;
- Be based on adequate information being provided (see further above), on which the A-Reps are given a fair and proper opportunity to understand fully the matters about which it is being consulted
- Be conducted with adequate time being given in which the A-Reps can respond;
- Involve conscientious consideration of responses provided by the A-Reps to the information and consultation;
The requirement to consult over ways of reducing the number of dismissals and mitigating the consequences of the dismissals will usually involve consultation about whether all of the proposed redundancies are required; whether or not enhanced redundancy payments would be made and about any possible redeployment initiatives.
The more difficult area to define is the extent of the requirement to consult over ways of avoiding the dismissals and specifically whether there is an obligation to consult before a decision is reached that some redundancies will need to be implemented. Whilst before the 2008 case of UK Coal Mining Ltd v NUM, it was generally considered that an employer was not obliged to consult about the reasons for the proposed redundancies, since that case, it now seems probable that an employer is indeed obliged to consult over the business reasons for the redundancies as part of its statutory requirement to consult over ways in which redundancy dismissals may be avoided. An example of where this might be relevant is if an employer is proposing to close a particular site, which will result in the loss of (20 or more) jobs, collective consultation on ways of avoiding the redundancies under section 188 should extend to consultation about whether or not the site should close and alternatives which would keep it open.
When must Collective Consultation begin?
The first (and crucial) point to appreciate is that TULRCA sets out the minimum period of consultation – it does not specify precisely when Collective Consultation should commence or how long the consultation should last.
Section 188(1A) provides that where the employer is proposing to dismiss 100 or more employees at one establishment within a 90-day period, consultation must begin in good time and in any event, at least 45 days before the first dismissal takes effect. Where the employer is proposing to dismiss between 20 and 99 employees in a 90-day period, consultation must begin at least 30 days before the first dismissal takes effect.
Thus it is important to appreciate that the circumstances may be such that to comply with the requirement to consult “in good time” before dismissals take effect, may require the period of consultation to start more than 45/30 days beforehand. One has to consider whether the period allowed for consultation is adequate, measuring backwards from the proposed date of dismissal, rather than whether consultation started at a particular stage in the decision-making process. Even so, consultation must always be started before any final decisions on redundancies have been made, otherwise the consultation will not have been undertaken "with a view to reaching agreement" over ways of avoiding the redundancies. Whilst not set in stone, the date on which the prescribed information (see above) is provided to A-Reps (or, where not all information is provided at once, the date sufficient statutory information is provided for meaningful consultation to take place) will typically be taken to be the date on which consultation begins.
The second important point to note (and a common misconception) is that collective consultation must last for the relevant minimum period of 45 or 30 days. The requirement is, in fact, only that the relevant period must elapse between the start of consultation and the date the first dismissal takes effect, and not that the consultation lasts for the whole of that period.
In practice (adopting a prudent approach), many employers will in fact ensure that consultation does last for a 30 or 45-day period or, at least, that such a period has elapsed from the beginning of consultation before serving any notices of dismissal.
Since the obligation to consult is “with a view to reaching agreement”, the process of consultation should continue for as long as is appropriate in order to either reach an agreement or exhaust the possibility of agreement. Once that stage is reached, the only restriction (in relation to proceeding with the redundancy proposals) is the fact that dismissals cannot take effect within the relevant minimum period after the start of consultation. Employers can give notice of termination during this period (provided that collective consultation has first been carried out), as long as the expiry of the notice occurs outside the period.
The Collective Redundancy Consultation requirements are complex and the financial penalties for failing to collectively consult, when the statutory obligation to do so is triggered, can be substantial.
Advice on this complex area of law can be obtained from partners Sue Dowling or Tim Clark, in our specialist Employment law team.
You may also find our other blog articles on Collective Consultation helpful.
For further information or legal advice, please contact law@blandy.co.uk or call 0118 951 6800.
