Hamilton v Nortel Networks UK Ltd (in adm... [2011] NIIT 321

THE INDUSTRIAL TRIBUNALS

CASE REF: 321/10

CLAIMANT: 1. Andrea Hamilton

2. William Irvine

RESPONDENT: Nortel Networks UK Ltd (in administration)

DECISION ON A REVIEW

The application for review of the second-named claimant (Mr Irvine) is successful. The tribunal has decided to vary its main decision in this case, so that the following is substituted for the relevant part of the main decision:

(A) Ms Andrea Hamilton, who was a Northern Ireland employment representative on Nortel’s “UK Employee Forum” (“the Forum”) has made an application pursuant to Article 217 of the Employment Rights (Northern Ireland) Order 1996 (“the 1996 Order”), complaining that the respondent has failed to comply with the requirements of Article 216 of the 1996 Order in relation to “employee representatives” (in her capacity as a member of the Forum).

(B) We are satisfied that this application was made within the relevant statutory time-limit.

(D) The tribunal has decided to make a protective award in respect of all of those employees of the respondent to whom all of the following circumstances apply.

(1) The employees were dismissed by the respondent as redundant during the period beginning in or about the month of March 2009 and ending in or about the month of June 2009.

(2) They were employed in Northern Ireland.

(3) They did not fall within a description of employees in respect of which Unite was recognised by the respondent.

(E) It is ordered that the respondent shall pay remuneration for the protected period.

(F) The protected period began on 30 March 2009 and lasted for 90 days.

Constitution of Tribunal:

Chairman: Mr Paul Buggy

Members: Ms Francesca Graham

Mr Michael Grant

Appearances:

The applicant for this review, Mr Irvine, was self-represented.

There was no appearance on behalf of the respondent. The Department for Employment and Learning was represented by Mr Peter Curran of its Redundancy Payments Branch.

REASONS

1. It seems unlikely that Nortel will be able to pay any award which may become payable as a result of this application for review. Accordingly, although Nortel put in a response to this application (for review), which argued that the review should not be granted, Nortel decided not to be represented at this hearing. That was an entirely appropriate position for Nortel to take.

2. The Department participated, in the context of this application for review, pursuant to Rule 51 of the Industrial Tribunals Rules (“the Rules”). Rule 51 provides that the Department for Employment and Learning is entitled to appear as if it were a party and be heard at any hearing in relation to proceedings which may involve a payment out of the Northern Ireland National Insurance Fund, and in that event it shall be treated for the purposes of the Rules as if it were a party. As usual, the tribunal is grateful for the constructive and helpful role which Mr Curran has played in connection with the present proceedings.

3. In June 2010, we issued our Decision (“the Main Decision”) in respect of seven lead cases which had been brought by various applicants, all of whom sought a protective award. The only one of those lead cases which matters in the present circumstances is the case of Andrea Hamilton (321/10).

4. The present Decision, in relation to Mr Irvine’s application for review, should be read in conjunction with the Main Decision. For the purposes of deciding the present application, we adopt the findings of fact and legal principles which are set out in the Main Decision, except to the extent (if any) that the contrary is indicated below.

5. At the end of March 2009, more than 80 redundancies were declared at Nortel’s Monkstown plant in Northern Ireland. All of those 87 redundancies were clearly within the scope of the protective award which the tribunal made in the Main Decision. However, in or about the end of June 2009, approximately 15 more redundancies were declared at the Monkstown plant.

6. Mr Irvine was one of the people who were made redundant in June.

7. Mr Irvine argues that he is already within the scope of the protective award which was made by the tribunal in the Main Decision. (He claims to be ” …. [an] employee of a description to which [that] award relates …” In order to vindicate that alleged entitlement, Mr Irvine has presented a complaint to an industrial tribunal pursuant to Article 220 of the 1996 Order. By agreement between Mr Irvine and the Department, the hearing of that application has been postponed. (In view of the outcome of this application for review, that Article 220 application will now be unnecessary).

8. Alternatively, Mr Irvine asserts that the Main Decision of the tribunal, as it relates to the Hamilton application, should be varied so as to explicitly include the redundancies which were declared in or about June 2009. The aim of his application for review is to achieve that outcome.

9. Originally, Mr Irvine was not a party to the Hamilton application. He was added as a party, after the Main Decision had been issued, in order to make it possible for him to pursue this application for review. (Such a practice, of adding new claimants after the event, so that they could apply for review in respect of the scope of a protective award, was recommended by the Employment Appeal Tribunal in Harford and Others v Secretary of State for Trade and Industry, UKEAT/0313/07/LA). This application for review has not been made within the stipulated review time-limit. (We have decided to extend that time-limit).

10. The position of Nortel, as expressed in its response to this application for review, is that there were two entirely separate and distinct separate sets of redundancies, one set occurring in March and a second set occurring in June, and that the June redundancies are therefore not within the scope of the protective award which we made in the Main Decision.

11. The Department takes a similar view, and reminds us that an employment tribunal in Great Britain treated March 2009 redundancies declared by Nortel, and June 2009 redundancies also declared by Nortel, as constituting two separate rounds of redundancies, each of which attracted a separate protective award.

12. It seems to us that the GB Tribunal decision is of limited assistance to us, in deciding this application for review, because the GB decision was made only in respect of establishments in Great Britain, and because it was based on the particular evidence that was made available to that tribunal in that case.

13. All of the lead cases which were the subject of the Main Decision were cases which involved only people who had been declared redundant in or about March 2009. None of them involved people who had been declared redundant in or about June 2009. During the course of the main hearing, no reference was made to any redundancies which had occurred in June.

14. If the June redundancies were an entirely new set of redundancies, and were entirely unrelated to the March redundancy situation, they would trigger a new obligation, on the part of Nortel, to collectively consult, but only if the June redundancies at Monkstown amounted to at least 20 (whereas, or course, they amounted only to approximately 15 redundancies).

15. The threshold of 20 is provided for in Article 216(1), which provides as follows:

“(1) Where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less, the employer shall consult about the dismissals all the persons who are appropriate representatives of any of the employees who may be affected by the proposed dismissals or may be affected by measures taken in connection with those dismissals”.

16. Article 217 gives guidance as to the scope of any protective award which is made as a reaction to any particular failure to carry out the Article 216 collective consultation obligation. According to Article 217(3), the position is as follows:

(3) A protective award is an award in respect of one or more descriptions of employees –

(a) who have been dismissed as redundant, or whom it is proposed to dismiss as redundant and

(b) in respect of whose dismissal or proposed dismissal, the employer has failed to comply with a requirement of Article 216”.

17. If a particular protective award is to apply in respect of any specific group of employees, three preconditions have to be met in respect of that group. If we consider the preconditions set out in Article 217(3) in relation to the June 2009 redundancies, the position seems to be as follows.

18. First, the June redundancy people all fell within the description (type) of employees to which the Hamilton protective award related, because all of them, the tribunal is informed, were located within parts of the Monkstown plant in respect of which Unite did not have collective bargaining recognition, and those were work-units which fell within the scope of the Forum’s operations. Secondly, the June redundancy candidates have all been dismissed as redundant. Accordingly, the real issue is whether the third of the Article 217 preconditions has been satisfied. The third precondition is that the dismissal or proposed dismissal of the June redundancy candidates must have fallen within the scope of the collective consultation obligation which the employer breached in relation to the March redundancy candidates.

19. In the context of this application for review, the most relevant part of the Main Decision, is paragraph (D), which was in the following terms:

“The tribunal has decided to make a protective award in respect of all of those employees of the respondent to whom all of the following circumstances apply.

(1) The employees were dismissed by the respondent as redundant in or about the month of March 2009. (2) They were employed in Northern Ireland.
(3) They did not fall within a description of employees in respect of which Unite was recognised by the respondent.”

20. In the course of the hearing of this application for review, we received oral testimony only from Mr Irvine. He was informed by his line manager on 22 June 2009 that he was being made redundant. All of the other June redundancy candidates were informed at around the same time. The redundancies took more or less immediate effect. Nobody had ever said to him, during the period from March 2009 until 22 June 2009, that there might be another round of redundancies.

21. When Ms Hamilton made her application in the main proceedings, she did so on the basis that the application was relating only to March redundancy candidates. That was entirely appropriate, from Ms Hamilton’s point of view, because the purpose of her application was to cover the situations of all of those Unite members who had been made redundant in 2009, but who worked in parts of Nortel in respect of which Unite was not recognised for collective bargaining purposes. All of that group of people had been declared redundant in March 2009, and none of them had been declared redundant in June 2009. However, as the Harford judgment shows, the proper scope of a particular protective award has to be independently ascertained, and cannot be cut down merely because the scope of the application for a protective award is narrower than the scope of the persons who are “… affected by the proposed dismissal” or who … may be affected by measures taken in connection with those dismissals”.

Conclusions

22. The provisions in respect of protective awards are to be found in Part XIII of the 1996 Order. Those provisions have to be regarded as being intended to implement the requirements of Council Directive 98/59/EC; Part XIII has to be construed accordingly.

23. It is clear that the inclusion of a threshold requirement, that the employer must be proposing to dismiss at least 20 employees at the relevant establishment, is designed to avoid imposing onerous obligations upon employers in respect of small-scale redundancies.

24. We have not found this an easy case to decide. In our view, it is a border-line case. However, we have ultimately come to the conclusion that the March redundancies and the June redundancies have to be regarded as constituting a single set of redundancies. The June redundancies were announced by 22 June, still within the period of 90 days beginning on 31 March. No doubt there are many redundancy situations in which an employer initially envisages that he will only have to make a particular number of staff redundant, but later realises, as a result of the implementation of that redundancy process (the collective consultation process in respect of that number of contemplated redundancies) that it has to make more redundancies than it had initially planned. That may well be what has happened in this instance. Certainly, we have no clear evidence that the June redundancies were an entirely separate event, or that they had no connection with the March redundancies.

25. It seems to us that when redundancies take place in two stages, it is easier to regard the two stages as part of a single process, if the second round of redundancies takes place very soon after the first round of redundancies. It also seems to us that it is more difficult to regard the two rounds as part of the same process, if the second round takes place long after the end of the first round.

26. Thus, if the redundancies which were in fact declared in June 2009, had instead been declared in March 2010, we would have had no hesitation in regarding the two sets of redundancies as being entirely separate and distinct from one another; and, on the other hand, if the June 2009 redundancies had in fact been declared in April 2009, we think that nobody would have had any hesitation in accepting that the two sets of redundancies were sufficiently interconnected to fall within the scope of the March 2009 collective consultation obligation.

27. In our view, the June redundancies fall within the outer edges of those redundancies which can be properly regarded as falling within the scope of the March collective consultation obligation, but they are nevertheless within those edges.

28. Accordingly, the wording of the Main Decision, as it applies in respect of the Hamilton application, must be varied to the extent indicated at the beginning of this Decision.

29. In the Main Decision, we found that Nortel, in the context of the March 2009 dismissals, had failed to carry out any meaningful Article 216 collective consultation.
As Article 216(4) makes clear, relevant consultation must include consultation about ways of avoiding the dismissals, ways of reducing the number of employees dismissed, and ways of mitigating the consequences of the dismissals. If such consultation had been carried out in March 2009, the possibility that it would become necessary to declare the June redundancies might well have been brought to the attention of Forum representatives at that point. On that basis alone, Mr Irvine and the other June redundant employees can be properly regarding as being persons who, at March 2009, were employees:

“… who may be affected by the proposed dismissals [the dismissals which were being proposed at the end of March 2009] or may be affected by measures taken in connection with those dismissals ...”

Chairman:

Date and place of hearing: 19 November 2010, Belfast.

Date decision recorded in register and issued to parties:

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You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> Hamilton v Nortel Networks UK Ltd (in adm... [2011] NIIT 321_10IT (20 January 2011) URL: http://www.bailii.org/nie/cases/NIIT/2011/321_10IT.html Cite as: [2011] NIIT 321_10IT

Industrial Tribunals Northern Ireland Decisions