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04 Nov 2022

Employment

Twitter, mass dismissals and UK Employment Law

Having taken control only a week ago, Elon Musk is currently on a mission to reduce Twitter’s 8,000 strong workforce by as much as 50%. Employees are already being locked out of their remote desktops, while they await an email – if it goes to their work email account, they have a job, if it goes to their private email account, they don’t. Just like that. From an external perspective, there appear to be no attempts to comply with the requirements of UK employment law.

Reports are that Twitter’s UK HQ in London has all the blinds drawn and nobody has been seen going in or out of the building and Musk’s mass sackings are being described as a “digital P&O”, after the ferry company’s infamous firings earlier this year.

So in the UK, where do employees stand?

1 . Employers should consult with workers before making them redundant.

You’re entitled to a consultation with your employer if you’re being made redundant. This involves speaking to them about:

  • why you’re being made redundant
  • any alternatives to redundancy

If your employer is making up to 19 redundancies, there are no rules about how they should carry out the consultation, other than the requirement that employers should act fairly and reasonably if they wish to avoid successful unfair dismissal cases potentially worth up to a year’s salary.

If your employer is making 20 or more employees redundant at the same time, there is a legal requirement to comply with the collective consultation obligations enshrined in UK law which require consultation your employer and a representative (rep).

This will either be:

  • a trade union rep (if you’re represented by a trade union)
  • an elected employee rep (if you’re not represented by a trade union, or if your employer does not recognise your trade union). If there are no elected representatives, then employees must be afforded an opportunity to elect representatives before consultation can commence.

Collective consultations must cover:

  • ways to avoid redundancies;
  • the reasons for redundancies;
  • the selection process;
  • how redundancy payments are to be calculated;
  • how to keep the number of dismissals to a minimum;
  • how to limit the effects for employees involved, for example by offering retraining.

2. Employers wishing to make more than 100 redundancies must notify the business secretary at least 45 days in advance of these dismissals and if making more than 20 employees redundant must notify the business secretary at least 30 days in advance.

It is thought that Twitter UK Ltd (as it is registered in the UK) employs around 280 staff, so if they are looking to offload 50% of those, they should have notified the Business Secretary 45 days ago. It seems unlikely that this has occurred.

In addition a failure to comply with the consultation requirements is a criminal offence and potentially exposes Twitter to prosecution and a fine. It is difficult to comment on whether Twitter would have a defence to any prosecution that might be brought under section 194(4) of the Trade Union and Labour Relations (Consolidation) Act 1992.

However, the penalties for non-compliance with the rules on notifying the government have not acted as a major deterrent in the past and the likelihood is that the company would avoid a significant fine. Despite the Government referencing unlimited fines, the reality is that no meaningful fine has ever been issued under the Act and up to 2015, the maximum fine that could be issued was £5,000.

Perhaps of greater deterrent to other employers is the fact that an officer of a company could be prosecuted personally and that in turn a conviction could lead to directors’ disqualification proceedings being brought against that individual on the basis that they are an unfit person to be a company director.

What will Twitter’s actions mean for other UK employers?

In the wake of the P&O scandal, there were widespread calls for a change to the law so that unions and employees can ask the courts to automatically stop companies following in their footsteps. However, this is yet to materialise.

As indicated above, there may be potential sanctions but historically, company directors have not faced personal consequences for breaching the collective redundancies legislation.

While this is a high profile and callous approach to collective redundancies, it certainly isn’t the first time that the legislation has been disregarded by employers in the interests of “expediency”. While there have been calls to changes in legislation, it would be extremely surprising if these changes were to be introduced by the current government, since they previously watered down the legislation which stemmed from the UK’s past membership of the European Union.

If you are being made redundant you may be able to make a claim to an employment tribunal if your employer does not consult properly, for example if they start late, or do not consult at all. If you are looking for advice in this area, our experienced Employment team are well placed to assist you. Contact us today to arrange an appointment.

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