An employment tribunal has awarded a £2m payout to almost 10,000 former employees of high street retailer Wilko, which shut down after going into administration in 2023.
The award was made because of faults in consulting staff properly before they lost their jobs.
The judgment stated that it was not disputed that Wilko Retail Ltd had “failed to comply with the requirements of Section 188 Trade Union & Labour Relations (Consolidation) Act 1992.”
As a result the tribunal made a protective award of all staff employed by the firm as of 31 January 2019 “in respect of whom the Claimant had collective bargaining rights and whose employment terminated by reason of redundancy between 31st January 2019 and 12th April 2019.”
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The GMB union, which raised the legal case, said that about 9,000 former staff who worked in a store with 20 or more people would get four days’ pay, while about 1,100 employees who worked in a distribution centre or support centre role would receive 13 days’ pay, according to the union.
Former Wilko worker and union representative David Bartlett said the award would not make up for the strain felt by the workforce during and after the closure.
He said: “It has been a long, hard, slog getting this money – the very least Wilko workers deserve after the way they were treated.
“In no way will this make up for the stress and anxiety they faced during those dark days in 2023.
“But GMB hopes it will give them a much-needed boost as they move on with their new lives and careers.”
The business was founded in 1930 when JK Wilkinson opened his first store in Leicester and expanded across the Midlands initially. During the 1990s Wilkinson’s became one of Britain’s fastest-growing retailers, rebranding as Wilko in 2012.
Despite the collapse of Woolworth’s in 2008, Wilko’s began to struggle due, retail experts say, to its locations, lack of online presence, supply chain difficulties and competition from online suppliers.
In early August 2023 the firm, headquartered in Worksop, Nottinghamshire, fell into administration and put 12,500 jobs at risk, before closing down its 400 stores the following month.
Legal comment
Partner and head of employment law at Harper James, Simon Gilmour, said: “Under UK employment law, where an employer proposes to make 20 or more employees redundant within a 90-day period at a single establishment, there is a legal obligation to engage in collective consultation with elected employee representatives or a recognised trade union.
“Wilko did not allow sufficient time (in this case 45 days) to carry out the consultation before making the redundancies. Although it was clear during the administration process that large-scale redundancies were coming, proper consultation still didn’t happen. This procedural failing meant that affected employees were denied a fair opportunity to understand, question, and respond to the proposed redundancies.
“As a result, to penalise the company due to the lack of proper consultation, the tribunal awarded a protective award to nearly 10,000 workers. This is a clear reminder that, even in times of serious financial difficulty, meaningful consultation is still a legal requirement.
“Tribunals are typically unsympathetic to arguments that time constraints or uncertainty made consultation impractical. The Wilko case highlights the importance of placing people at the centre of organisational change. Doing so not only mitigates legal and financial risks but also builds trust, morale and transparency during uncertain times.”
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