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Manuel Cortes letter To TSSA Thomas Cook Members

25 September 2019

Dear TSSA member, Firstly, let me convey my deepest sympathies to you and your dependants and families on behalf of all of our TSSA family.

 The news of Thomas Cooks’ liquidation has come as an awful blow for hundreds of thousands of people from all over the world. Not least of all for their employees. The impact cannot be underestimated.

We have produced some information about legal rights to support members which is enclosed (see below). At the same time, we are continuing to press the government on several matters.

We were shocked to hear the governments of Turkey and Spain were actively seeking to step in to assist and support the business. However, it seems they were given short shrift by the British government for reasons unknown to us at the time of writing. This is outrageous and will be pursued further.

I sought an urgent meeting with the Secretary of State for Business, Innovation and Skills, Andrea Leadsom, with a view to urging the government to step in and support the failing business using new innovative measures to transform holidays and tourism for the future. The government refused.

I also had grave concerns that the hole left in the industry would generate a lack of competition that would see rival travel company TUI controlling the mass market, and this could potentially see an increase in prices. This is a matter the government will look into. I have also written to the Competition and Markets Authority calling for an “urgent inquiry” into the collapse of Thomas Cook.

The only people who were not complaining were the hedge fund traders who had invested in derivatives which pay out when a company fails. Hundreds of millions of pounds went in that direction. The irony is sickening.

My new priority is to ensure our members have jobs. I have received assurances that the government will provide assistance and support to as many ex-employees as possible. It remains to be seen how this will manifest itself. Members in Scotland can get help and advice from www.skillsdevelopmentscotland.co.uk which so far is the only government agency to offer support.

Finally, the Union’s National Officers have agreed to provide our ex Thomas Cook members with free membership from this point. This will be done automatically, and we shall write to you at a later date explaining with further detail how this will operate.

All that remains to be said is that your TSSA team and I are utterly dedicated to pushing for answers to questions and as much fairness as feasible for all. We recognise what an awful time you are all having and feel that staff have shown great strength and courage in continuing to support each other and passengers.

My kindest regards

Manuel Cortes

Information About Legal Rights 

REDUNDANCY AND INSOLVENCY

When a company becomes insolvent and jobs are lost, employees have rights to make a number of claims, at least for some of the monies that might be owed to them.

All debts owed to a redundant employee must be notified to the insolvency practitioners in writing. The insolvency practitioners will provide the relevant forms to complete to set out the monies owed. Some of those debts will be met by the government’s Insolvency Service, Redundancy Payments Office.

Employees made redundant (with 2 years’ service or more) are entitled to redundancy pay and statutory redundancy pay can be claimed from the Insolvency Service.

Holiday pay, notice pay and up to 8 weeks arrears of pay can also be claimed from the Insolvency Service, subject to statutory caps. The insolvency practitioners/official receiver will provide the necessary forms to make those claims and claims can be made online at https://www.gov.uk/claim-redundancy.

Protective Award Claims

In addition to claims for basic statutory entitlements, it might also be possible to make a claim for protective award compensation. However, this requires the employee to submit an Employment Tribunal claim – not just complete the Insolvency Service RP forms.

The Basics

Where an employer is proposing to make 20 or more employees redundant at an ‘establishment’ (i.e. a workplace) there is a duty to inform and consult with appropriate representatives for a minimum period of 30 days (or 45 days if more than 100 are to be dismissed).

It is important to appreciate that this type of claim only covers employees – not workers or those who are self-employed.

It is essential that 20 or more redundancies were proposed at the place of work/office/shop location (the “establishment”). If not, or there were not 20 or more staff at the place of work, a protective award claim cannot be pursued because the duty to collectively inform and consult doesn’t arise.

‘Appropriate representatives’ are either a recognised trade union or an existing employee forum suitable for redundancy consultation. Where there are neither, the employer must hold elections to appoint representatives for the purpose of redundancy consultation.

Where the duty applies, the employer is obliged to provide a minimum amount of information to those representatives, such as the reasons for redundancies, who is affected and methods for selection, for example. It is also obliged to consult with the representatives about ways of avoiding redundancies, reducing the numbers and mitigating the consequences of redundancies, with a view to reaching agreement.

Where the employer does not comply with these obligations, a claim can be brought in the Tribunals for a Protective Award.

.A Protective Award claim is a stand-alone claim and is different from claims for redundancy pay or notice pay, for example.

Despite the insolvency of the employer (and lack of funds), protective award claims are worthwhile pursuing because it may mean that more money can be claimed from the government’s Insolvency Service.

Protective Award Claims in the Employment Tribunal

Where there are grounds to make a claim and there is no recognised trade union or existing employee forum suitable for redundancy consultation, it is essential that any elected employee representatives and the employees themselves pursue protective award claims.

The claim must be pursued within the appropriate 3-month (less one day) time limit – see more below. Any employee who does not bring a Protective Award claim within the 3 month (less one day) time limit will not be able to receive compensation for a Protective Award.

You will need permission from the insolvency practitioners/official receivers or Court to pursue or continue the claim, but the 3-month (less one day) deadline for submitting a claim to the Employment Tribunal mustn’t be missed.

Once lodged, the insolvent company will need to decide whether to defend the claim. The insolvent company might raise the argument that there were ‘special circumstances’, which meant that the company did not have time to consult. However for this argument to succeed something very out of the blue must have happened.

If successful, the Employment Tribunal will need to decide what size Protective Award to make, which can be up to 90 days’ gross pay per employee. The size of the award depends what attempts were made (if any) to engage in the information and consultation process prior to making redundancies and whether there were any mitigating factors.

Usually an Employment Tribunal hearing is needed to decide the claim and how much to award. This can often take place within 12 to 15 months of the date the claim is lodged, so it is a lengthy process.

Claiming Protective Award Compensation from the Government

If the company is insolvent, you won’t recover all of that as compensation even if you win the claim but you can direct the judgment to the Insolvency Service.

Some of the Protective Award compensation awarded by the Employment Tribunal can be paid by the Insolvency Service.

Insolvency Service payments will be based on gross weekly pay at the time of redundancy and capped at £525 per week. You can only claim a maximum of 8 weeks’ (56-days’) pay. The amount will be reduced if a claim has already been made for arrears of wages. So, if a claim is made for 3 weeks’ unpaid wages, only 5 weeks’ pay will be available towards Protective Award compensation.

Compensation is also likely to be subject to some further deductions for National Insurance and Jobseeker’s Allowance (if you received any) and possibly tax.

Any balance of the compensation will be an unsecured debt, at the bottom of the debt pile. Usually there is very little or no money available for unsecured debts.

The amount you receive from the Insolvency Service for statutory notice pay, holiday pay and statutory redundancy pay will not affect the Protective Award payment.

Time Limits and ACAS Early Conciliation

You only have 3 months (less one day) from the date of the redundancies to start an Employment Tribunal (ET) claim.

It is a legal requirement that ACAS must be contacted under the Early Conciliation procedure within this time limit before a claim can be submitted to the Tribunal. The time limit for submitting the claim to the Tribunal can be extended by this process, but it depends when ACAS is contacted and how long ACAS is involved.

An Early Conciliation Certificate must be secured before a claim can be submitted to the Tribunal.

TSSA will not be responsible for starting a claim for a Protective Award in the Employment Tribunal unless we here further from you.

To this end if you know of any sites where you believe that there were 20 or more employees at any site please do not hesitate to contact TSSA Organiser, Tony Wheeler. Tony can be contacted on 07803 236554 or wheelert@tssa.org.uk .

 

 

 

 

General Secretary

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