Veale Wasborough Vizards
07 JUL 2015
Collective consultation obligation triggered upon provisional decision to close school
Solicitor, Veale Wasbrough Vizards
The Employment Appeal Tribunal (EAT) dismissed a school's appeal, against a 90 day protective award for each employee where no consultation took place over the closure of the school and the school was not aware of its consultation obligations.
In the case of E Ivor Hughes Educational Foundation v Morris, the school operated by E Ivor Hughes Educational Foundation (the School) held a governors' meeting in February 2013 when it was decided that if pupil sizes did not increase by the end of April of that year the School would have to close.
In April 2013 it was confirmed that pupil numbers for the next academic year would be lower than expected and a further governors' meeting was held in April 2013 when it was decided that the School would close at the end of the summer term 2013. All staff at the School were given a term's notice on 29 April of dismissal at the end of the summer term, 31 August 2013. There was an obligation on the School under legislation to collectively consult with employees as it was to make 20 or more employees redundant on closure of the school. The School was unaware of its obligations in this respect and no consultation took place.
The employees brought a claim in the Employment Tribunal (ET) for breach of the collective consultation obligations.
The ET found that the School had failed to collectively consult with employees and that this obligation had been triggered at the February meeting, when the governors had decided that it would be necessary for the School to close if pupil numbers did not increase. The ET rejected the School's special circumstances argument that any consultation with staff risked the news of closure being linked to the parents which would have sealed the School's fate of closure. The ET awarded each employee the maximum 90 day protective award.
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The EAT dismissed the School's appeal against the protective award made to each employee. It upheld the ET's findings that the duty to collectively consult was triggered by the February 2013 meeting. The EAT noted that tests set out in previous case law were satisfied, that there was either a "fixed, clear, albeit provisional intention" to close the School or a "strategic decision… compelling the employer to contemplate or plan for collective redundancies".
The EAT agreed with the ET that there were no special circumstances making it not reasonably practical for the School to consult. It found the School's argument that it needed to keep the closure plans confidential for fear of loss of confidence in the School to be artificial. Assessment of the practicalities of consultation should take place at the time the obligation is triggered, which could not have happened in this case as the School was unaware of its obligation to collectively consult.
The EAT also upheld the level of the protective awards. It concluded that the ET had considered all potential mitigating factors. The EAT acknowledged that the School's failure to consult was not deliberate but agreed with the ET's conclusion that the School's failure to abide by the law and consult with its employees came from a "reckless failure" to seek legal advice.
In situations where a potential closure is being seriously considered, employers should seek legal advice in respect of consultation obligations as soon as possible. If the employer believes there to be special circumstances making it not reasonably practical to comply with any collective consultation obligations, a proper evaluation and consideration of the facts and the practicalities of consultation should be carried out at the relevant time. Employers should note that this evaluation of special circumstances cannot take place after the duty to consult has arisen.