Complicated task of obtaining redundancy pay for Carillion workers revealed
The task of applying for redundancy payments for workers who lost their jobs following the collapse of Carillion was “unduly complicated” because of the extent of the engineering giant’s structure, according to a report.
Research by Unite revealed that many workers did not know the true identity of their employer because there were “hordes” of separate companies within the group.
The union said many of the companies did not even feature the Carillion name.
A study by Unite found that in many workplaces where Carillion operated, staff were employed under two separate companies.
Legal claims against Carillion have been delayed by “draconian” insolvency law requirements, said Unite, revealing it had to obtain High Court permission to take forward workers’ cases.
The Government has already paid £50 million in redundancy pay for ex-Carillion workers, and the figure is expected to rise to £65 million, said Unite.
Howard Beckett, Unite’s assistant general secretary, told the Press Association, said: “The Carillion fiasco has further identified that major reforms are needed to ensure that workers can secure compensation if they lose their jobs through no fault of their own.
“It is simply incredible that workers and unions have to jump through hurdles such as applying to the High Court, simply for permission to progress straightforward legal cases when a company is in compulsory liquidation.
“It is a travesty to justice that administrators and special managers are able to contest cases made by unions for a protected award (for failing to inform and consult workers before making them redundant) not because they have any realistic hope of winning but in order to boost their fees.
“Usually this money is taken from the carcass of the failed company. In the case of Carillion, where there was no money left, this money is being paid directly by the taxpayer.”