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Mass redundancy plans - Marks & Spencer to axe 7,000 jobs in the UK

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Mass redundancy plans - Marks & Spencer to axe 7,000 jobs in the UK

It is reported that Marks & Spencer (M&S) intend to make around 7,000 of their employees redundant over the next 3 months, as a result of a ‘material shift in trade’ following the COVID-19 pandemic lockdown restrictions.  

M&S has recently reported that the national lockdown as a result of the COVID-19 pandemic has seen a significant drop in in-store sales of food, clothing and other goods, whilst online sales reportedly soared during this period. It is reported that M&S hopes that a ‘significant proportion’ of the job cuts will be made through voluntary redundancies or early retirement.

In the event of a sudden need for redundancies within any business, where a company is making 20 or more employees redundant within any 90-day period at a single establishment, the company has a legal obligation to undertake a minimum period of consultation with those affected. The employer must notify the Redundancy Payments Service before a consultation starts.

The redundancy consultation period

The primary duty for employers is to inform and consult with 'appropriate representatives' of the affected employees.

Appropriate representatives are usually trade union representatives. However, if there is no recognised trade union, the employer must look to appoint “employee representatives”. Often, employers have existing staff committees who, in these circumstances, may step in and act as such representatives. However, where this does not happen, a formal election may need to be held. Where there is no recognised trade union or employee representatives, the employer must consult with all affected staff individually.

Under the legislation, the employer must disclose in writing to the appropriate representatives:

  • The reasons for its proposals
  • The numbers and descriptions of employees whom it is proposed to dismiss as redundant
  • The proposed method of selecting the employees for dismissal and
  • The method calculating the amount of any redundancy payments to be made

Where 100 or more redundancies are proposed, consultation must begin at least 45 days before the first dismissal. In cases where more than 20, but less than 100, redundancies are proposed, the consultation must begin 30 days before the first dismissal occurs.

What if the employer fails to properly carry out the consultation?

If the company fails to meet its obligations above then an employee can take an employer to an employment tribunal. Here, it can be requested that the tribunal make a 'protective award' in the claimant’s favour. This requires employers to pay employees their normal week’s pay for a period of time called the ‘protected period’. The tribunal has the discretion in fixing the length of that period, depending upon what is just and equitable and taking account the seriousness of the employer’s default. Any award would be in addition to any outstanding redundancy pay and notice pay.

The maximum length of the protected period is 90 days in all cases where 20 or more are to be made redundant.

What if the employer is in financial difficulty?

Even if the employer is insolvent and does not have the means to pay the tribunal judgment, you may still be able to bring a claim against the employer and obtain compensation from the Redundancy Payments Service.

What can you do?

If you have been affected by the consequences of your employer making redundancies following the COVID-19 pandemic, and believe that it has failed to comply with the above when making you redundant and would like to discuss this with a member of our specialist team, please call us on 0161 696 6170 or complete our online enquiry form