EV employees launch successful protective award claim

Ex employees at EV business Onto Holdings Limited are jubilant after securing a substantial employment tribunal award after a collective redundancy.

Onto Holdings Protective Award claim

38 members of staff at Onto Holdings turned to Pearson Solicitors for help and the employment team, led by partner and Solicitor, Alan Lewis, succeeded in obtaining a Protective Claim Award for them of 90 days pay per employee

Teneo Financial Advisory Ltd were appointed as administrators when the Warwick based EV subscription service, Onto,  went into receivership, but when staff challenged the circumstances of their redundancy the administrators disputed the claim.

Onto employed 139 staff, and 61 of the positions were made redundant.

In this case all of the claimants were made redundant with no appropriate consultation with employee representatives prior to them being made redundant.

Pursing a Protective Award Claim

Employees are entitled to pursue a claim for a protective award if 20 or more employees are made redundant from one establishment and their employer does not follow a statutory consultation process before making them redundant.  The claim was initially defended by the administrators on the basis that not all of Onto Holdings offices/locations made 20 or more employees redundant, even if the total number of employees made redundant by Onto across all locations substantially exceeded 20.

The Employment Tribunal held that all employees were collectively made redundant from one establishment, no matter where they were based, even working remotely at home.

Partner and Employment Law Solicitor, Alan Lewis, who led the claims on the basis that the correct redundancy procedures were not followed said upon receiving the judgment:

“I am delighted to have secured judgment for all my clients in a case that was defended by the administrators,” said Alan.

“The administrators, Teneo Financial Advisory, attempted to defend the claim on grounds that were contrary to the way in which Onto Holdings Limited had dealt with a previous collective redundancy exercise, where all locations were aggregated together for the purposes of collective redundancy consultation.  They were unable to provide any explanation as to why the company had changed their position. I submitted a substantial amount of evidence and was able to persuade the Employment Tribunal that all of our clients, wherever they were employed, were part of the same establishment as Onto Holdings operated as one business regardless of where employees actually performed their work.”

“I was of the view that the administrators had acted opportunistically in trying to frustrate my clients’ protective award claims and the Judge had some sympathy with my view,” added Alan.

Collective Redundancy Consultation

If employers have not followed the correct procedures when making staff redundant then their employees can claim a little known financial claim known as a Protective Award, as was the case here.

It’s compensation of up to 90 days’ gross pay, which can be awarded by an Employment Tribunal when an employer fails to collectively inform and consult its workforce of twenty or more employees from the same establishment that they have been dismissed on the grounds of redundancy.

If a company is insolvent, the government guarantee payment of part of any award.  Employees do not need to have been employed for any minimum length of service to qualify for such an award and quite often employees obtain more compensation by way of a protective award than, for example, statutory redundancy or notice pay, which are completely separate claims.

“Thankfully, the line of defence used by the administrators will soon be assigned to the scrapheap, as the government intends to pass legislation to enable all employees of an insolvent business to pursue protective award claims, regardless of the number of employees made redundant at the workplace where they worked, provided that overall 20 or more employees are made redundant,” added Alan Lewis.

How can we help?

For legal advice on employee rights or to make a protective award claim contact our employment law solicitors on 0161 785 3500 or email enquiries@pearsonlegal.co.uk.

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Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.