Woolworths employees: payment of statutory notice periods (P.9/2009) – comments.

STATES OF JERSEY

WOOLWORTHS EMPLOYEES: PAYMENT OF STATUTORY NOTICE PERIODS (P.9/2009) – COMMENTS

Presented to the States on 3rd February 2009 by the Council of Ministers

STATES GREFFE

COMMENTS

P.9/2009  requests  the Minister  for Treasury  and  Resources  to  make  payments  to  the former employees of Woolworths plc. equivalent to the sums due to them in respect of statutory notice period provisions in accordance with the Employment (Jersey) Law 2003.

The proposition makes such payments conditional upon successful negotiation with the former employees to assign to the States their individual rights, which, in particular, include rights in respect of sums due in lieu of notice.

Once assigned, the proposition further requests the Minister for Treasury and Resources to seek reimbursement of the above sums from the administrators.

Whilst, on balance, as with P.2/2009, approving the proposition appears unlikely to set any legal precedent, it is clear to the Council of Ministers that a moral precedent would most definitely be established, and any argument otherwise  would  be  unjust  and  unfair  to  those  who  may  well  find  themselves  in  the  same  unfortunate circumstances as the former employees of Woolworths plc. in Jersey.

The Council of Ministers sympathises with the former employees of Woolworths plc. and equally anyone faced with redundancy in these difficult economic times, and welcomes the Minister for Social Security's promise, not only to bring forward legislation in February for the States to consider, but also to develop, as a matter of priority, proposals for an Insolvency Fund so that employees' rights are protected in the case of insolvency and funding agreed by the States to underwrite the associated costs.

The  Council  of  Ministers  believes  that  this  is  the  responsible  way  forward,  establishing  protection  against insolvency for all, backed by statute with well-defined rights and responsibilities clear and understood by all and accessible by all, rather than by establishing ambiguous and uncertain rights through a proposition short on detail, after limited consideration and with no funding mechanism identified but carrying an unknown and potentially considerable cost to the taxpayer.

The Council of Ministers asserts that it is important that the former employees of Woolworths are provided with every  support  and  assistance  in  identifying  and  pursuing  their  legal  rights  and  associated  claims  against Woolworths plc. and/or its administrators.

Success in pursuing their claims appears to hinge around whether local assets of Woolworths plc. can be properly protected, through the Royal Court, to meet the claims of creditors in Jersey.

In  the  absence  of  effective  representation  by  a  Union,  the  Council  of  Ministers  believes  that  it  is  the Government's role to ensure that the former employees receive the support and advice necessary to pursue such claims through the Royal Court and supports the decision of the Minister for Treasury and Resources to meet the legal costs of doing so.

This will extend further the undertaking to meet the costs of the initial legal advice which the Council of Ministers has already agreed to meet and which is already being provided for the former employees.

This  action  may  well  set  a  precedent  for  future  groups  of  employees  which  find  themselves  in  the  same circumstances and without effective representation or the means to secure that representation themselves.

However,  it  is  self-evident  to  the  Council  of  Ministers  that  in  such  cases  it  is  already  incumbent  upon  a responsible Government to ensure that every support and advice is provided.

The costs of any such precedent would be considerably less than those established by P.9/2009, particularly as once the current case were pursued through the Royal Court, case law would have been established to guide future decisions and potential actions.