THE INFORMATION AND CONSULTATION OF EMPLOYEE REGULATIONS 2004

FAILURE TO CONSULT CAN COST SERIOUS MONEY

The Information and Consultation of Employee Regulations 2004 give effect to an European Directive establishing a general framework for informing and consulting employees. The Regulations impose obligations on larger employers to put in place arrangements to ensure that employees are informed and consulted on a wide range of issues. The Regulations are being brought into force in stages as follows:

At least 150 from 6 April 2005
At least 100 from 6 April 2007
At least 50 from 6 April 2008

If an employer fails to comply with the Regulations, an employee (or trade union) may lodge a complaint with the Central Arbitration Committee (CAC). If the complaint is upheld by the CAC, the complainant may refer the matter to the Employment Appeal Tribunal (EAT). The EAT has power when the employer defaults to levy a fine of up to £75,000.
That the Regulations have real teeth is shown by the first reported case under the Regulations brought by the union Amicus against MacMillan Publishers Ltd. Amicus had previously lodged a complaint with the CAC concerning MacMillan’s failure to provide data as to how many people it employed in the UK. That complaint was upheld but the matter was not referred to the EAT. MacMillan’s failure to comply with the CAC’s decision led to a further complaint to the CAC – that MacMillan had failed to arrange a ballot to elect information and consultation representatives. Again, the complaint was upheld. This time the matter was referred to the EAT. In the EAT’s view, the breach was very serious. It formed the impression that MacMillan was opposed to the Regulations and was seeking to delay their implementation for as long as it could. That being so, the EAT decided to impose a fine which would deter others from adopting a cavalier attitude to the Regulations. It fined MacMillan £55,000.
There may be a temptation to dismiss the Regulations as a piece of bureaucratic nonsense. Many feel that the Regulations do not sit comfortably within the context of the UK’s business environment. However, the MacMillan case shows that the Regulations have real teeth. As MacMillan have discovered, employers ignore them at their peril.

If you would like to know more about the Information and Consultation of Employee Regulations 2004, please contact Nick Crook

Filed: 26/10/2007 16:22:49