Agency Worker Regs: Costly Consequences In Collective Redundancy And TUPE Consultation
Unison v London Borough of Barnet
A protective award has been granted to a group of employees where an employer failed to provide adequate information concerning agency workers during a collective consultation.
Following the implementation of the Agency Worker Regulations 2010, from 1 October 2011 both section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) and regulation 13 of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) were amended so that employers carrying out either:
• a pre-transfer consultation under regulation 13 of TUPE; or
• a collective consultation under section 188 of TULRCA
are required to provide the following information in relation to agency workers as part of their duty to inform and consult:
o The number of agency workers working temporarily for and under the supervision and direction of the employer;
o The parts of the undertaking in which they are working;
o The type of work that they are carrying out.
The present case involved a redundancy exercise that was being carried out by the London Borough of Barnet, and also the TUPE transfers of employees to two transferee employers. The redundancy exercise resulted in 16 dismissals and the TUPE transfers resulted in over 100 employees being transferred.
During the consultation process, neither Barnet nor Unison were aware of the new changes to the legislation at branch level given that they had only just come into force. Pre-transfer, Barnet provided Unison with some information about which teams within its structure utilised agency workers, however this was information was not complete and Barnet failed to provide a complete list of all its agency workers across the business.
Unison brought a claim against Barnet for failing to provide adequate information relating to agency workers and thus enable an effective consultation.
The Tribunal upheld Unison’s claim. It held that the information provided was insufficient and Barnet had not complied with its duties at law. It had specifically failed to report on both the types of work being carried out by the agency workers, and areas of the business which were using agency workers. The types of work being carried by agency workers was the most valuable information to Unison in the redundancy consultation process, where the main task is to try and save people’s jobs. Reductions could have been made to the amount of agency workers in a particular area of the business as a cost-cutting solution – however there was simply not enough information on which areas of the business that utilised agency workers and the type of work being done by them.
If a Tribunal finds a complaint under TULRCA/TUPE well founded it may make an order that the employer shall pay remuneration to the employees for a specific period (a protective award). The maximum award under TULRCA is 90 days’ pay and under TUPE it is 13 weeks’ pay. In both cases, guidance on the calculation of the award provides that the amount should ber based upon the seriousness of the employer’s default (Susie Radin v GMB and others).
In making a protective award in the present case, the Tribunal awarded differing levels of compensation to the different groups of employees. The individuals involved in the redundancy exercise were given the greatest protective award (60 days’ pay) as the tribunal considered Barton’s breach was most serious in relation to the redundancies.
For the staff members that were consulted as part of the TUPE transfers, the tribunal considered that Barnet’s breach was less crucial to the transfer process than the redundancy exercise and the award was reduced accordingly (40 and 50 days’ pay). Although the protective award was less, the tribunal held that the duty is still an important one.
This is the first decision that has been given on the new agency worker provisions. Whilst the case shows that compliance with the duty is perhaps of greater significance during redundancy exercises, it is important that employers are aware of and comply with their obligations in either situations, or face significant protective awards.
It is important for employers to ensure that they have properly managed records. This case demonstrates that the devil is in the detail and an employer must show both the areas of the business that is using agency workers and the type of work that is being carried out.