Collapsed firm must compensate former workers

An employment tribunal has ruled against a collapsed contractor and said its workers should receive compensation over a breach of employment law following their dismissal.

Central Building Contractors (CBC) was a Glasgow-based firm that went into administration in April 2020, after it crumbled under cashflow problems amplified by the coronavirus pandemic.

Three tribunal cases have been won against the contractor, who laid of 149 staff on the same day that it appointed administrators.

In one, employment judge Laura Doherty ruled that more than 60 workers were entitled to compensation. Meanwhile, in a separate case, whose ruling has emerged with more detail, judge David Hoey ruled that another worker, Jordan Kirk, was entitled to receive an award.

The workers had raised a claim against the contractor alleging that they were dismissed via email on 29 April 2020, without proper consultation.

Section 188 (1) of Trade Union and Labour Relations (Consolidation) Act 1992 states that, where a firm is proposing to dismiss as redundant 20 or more employees at once within a 90-day period of less, it must consult all persons affected by the measures.

A response by joint administrators submitted to an employment tribunal demonstrated that no such consultation occurred, the Kirk tribunal found.

Court documents from the same case also revealed that the contractor’s administrators — Interpath Advisory — did not respond to the allegation and did not appear in court.

The tribunal records relayed the administrator’s response: “They confirmed by email that 149 employees had been dismissed ‘immediately’, in other words, with no process having been followed.”

The administrators also failed to explain why a representative had not been elected to be part of the 90-day consultation period, according to the tribunal.

Judge David Hoey issued a judgement, saying: “The requirements of the legislation had not been followed as no consultation took place with any elected representative and no steps were taken to do so.”

Interpath Advisory declined to comment on the tribunal.

In cases of administration, claims won for redundancy pay are paid out through the UK Government’s Redundancy Payment Service.

Last month, former employees of civils firm part of Roadbridge won the right to claim for unpaid wages, which was expected to be a “significant” sum.

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