It had been alleged by BIS that the City Link directors were aware that large-scale redundancies were inevitable on 22 December 2014, but had failed to notify the Secretary of State until 26 December 2014. City Link was placed into administration on 24 December 2014.
The judge in this case found that there was evidence that the City Link directors had a real intention of saving City Link and its workforce by putting the company into administration. It was therefore held that the directors could not have been expected to notify the Secretary of State of planned redundancies on 22 December 2014.
The directors were accordingly acquitted.
Where there are plans to make 100 or more staff redundant at one site, employers must notify the Secretary of State 90 days in advance. Failure to comply with this requirement now carries an unlimited fine. Whilst the prosecution against the City Link directors failed, this case highlights how quickly employers must act in some circumstances once it becomes clear redundancies are unavoidable.
For more information, please contact Helen Hughes in our Employment Law team on 020 7665 0816.