Former City Link workers win maximum award against collapsed delivery firm
AN employment tribunal has made the maximum possible award to a group of former City Link workers for the delivery firm’s failure to consult about redundancies.
However the workers will only received a “small proportion” of the award of 90 days’ pay because City Link became insolvent.
On Christmas Day 2014, thousands of workers learned they were likely to lose their jobs and within a week 2,500 people had been made redundant without appointing any employee representatives and without any consultation.
Former workers pursued claims against City Link and 258 of those claimants have now been awarded 90 days’ pay by an employment tribunal in Leeds.
City Link had claimed that it was only when their final investment request to Better Capital was rejected on December 22, 2014, that the situation became clear about redundancies, but the Tribunal found there had been “a deliberate and calculated decision not to comply with their legal obligations”.
Daniel Kindell, associate at Morrish Solicitors, which brought the claim, said: “The company defended this case throughout and its stance has been vindicated by the penalty imposed. We hope the Tribunal’s decision gives ex-employees of City Link some sense of justice.
“It can only be described as a travesty that successful claimants can only claim a small proportion of this award from the government’s National Insurance Fund and City Link can continue to rely on its state of insolvency to the further detriment of those who worked so hard for it.”
City Link was acquired for £1 in April 2013 by Better Capital but its new owners were unable to reverse its fortunes and in early November 2014 had clear plans to implement a “turnaround plan” involving wide-scale redundancies.
The tribunal found that by mid-November 2014 it was clear there were only two options – implementation of that plan or insolvency – but the company made a “conscious decision for the financial benefit of City Link Ltd and Better Capital” to not begin consultations with employees.
