Union wins £1.5m for ex-Ethel Austin staff

SHOP workers’ union Usdaw has secured a £1.5m payout for more than 500 former Ethel Austin shopworkers where were laid off when the chain was placed into administration last year.

Usdaw had made a protective claim on behalf of workers who were based at the firm’s former headoffice and distribution centre in Knowsley and at a store in Edgeware, London, who lost their jobs when the company was placed into administration in Knowsley on February 8, 2010.

The headoffice was eventually relocated to Altrincham when Elaine MacPherson bought the business back from administrators MCR in April 2010.

An employment tribunal in Liverpool ruled that MCR had failed to properly consult with the union before making 1,700 emploees redundant and awarded its members compensation equating to eight weeks’ pay, capped at £380 per week.

The compensation is limited to employees made redundant from the Knowsley headoffice and the London store, as the tribunal ruled that MCR was not obliged to consult about workplaces where less than 20 redundancies were involved. In Ethel Austin’s case, this ruled out all but one of the 186 stores that were closed.

The Ethel Austin brand recently returned to the high street following the purchase of the business and assets of successor company Life & Style by Ashloch Ltd.

John Gorle, Usdaw national officer, said: “While the award can never fully compensate for staff losing their jobs, I’m sure our members will welcome the money and appreciate the effort Usdaw has made to secure this compensation for them. Cases like these really demonstrate the value of belonging to a trade union.

“However, I’m bitterly disappointed the tribunal limited the scope of the award. The fact that many of our members won’t be compensated just because their store had less than 20 staff is plainly wrong and shows the gaping loophole and injustice of the current legislation.

“1,700 employees were made redundant from the same company for the same reason, so to suggest only 500 of them constituted a collective redundancy is nonsense.”