Shop workers’ union Usdaw is taking legal advice on whether to challenge the UK’s implementation of EU collective redundancy legislation after thousands of former Woolworths staff were denied compensation because they worked in stores where less than 20 people lost their jobs.
The move came following an employment tribunal ruling that Deloitte, which acted as administrator to Woolworths after the retail chain’s collapse in 2008, failed in its legal duty to consult with the Usdaw before making redundancies.
More than 24,000 former Woolworths employees were awarded up to £67.8 million in compensation, ending a three-year battle folowing the company’s closure. Individual workers will be awarded 60 days’ pay, with the average pay-out expected to be £2,800. But the compensation will not apply to the 3,000 employees who worked in smaller store branches where fewer than 20 redundancies were made.
John Gorle, Usdaw’s national officer, said: “The fact that some of our members won’t be compensated simply because their store had less than 20 employees is just plain wrong and shows the gaping loophole and injustice of the current legislation.”
Usdaw general secretary John Hannett confirmed the union was taking further legal advice to appeal against this element of the judgment. “Usdaw thinks that the UK’s current interpretation of the law on collective redundancies is both unfair and possibly a breach of the European Directive which seeks to protect workers in large scale redundancy situations," he said.
Responsibility for the compensation payments rests with the taxpayer through the government’s Redundancy Payments Office. The Insolvency Service – of which the RPS forms part – confirmed it had been notified of the ruling and has provided information for former employees of the company on its website. Deloitte declined to comment on the ruling.
