Debenhams showdown: Hundreds of former workers – fired with just 2 days notice and facing a 10% cut to their pensions – launch fight for justice
Hundreds of former Debenhams workers are taking legal action after losing their jobs with just a few days’ notice – some by text message or Zoom call.
Lawyers say there was a ‘complete failure’ to follow the statutory process, and that the workers’ employment rights were breached.
Details of the claims come as the department store’s former private equity owners – who extracted more than £1billion of dividends despite saddling the chain with enormous debts and costs – face mounting pressure to help cover a £32million deficit in its pension fund.
The closure of Debenhams stores has cost 18,500 people their jobs over the last 12 months. Staff are angry they were not given the 45-day minimum consultation period for redundancy
The staff, some with decades of service, are angry they were not given the 45-day minimum consultation period for redundancy, which would have allowed them time to look for other jobs.
They argue Debenhams should have collectively consulted with employees for 45 days leading up to the redundancies – made during 2020 and 2021 when the chain was operated by Department Store Realisations Limited, a company overseen by administrators FRP – but didn’t.
Closure of the chain has cost 18,500 people their jobs over the last 12 months.
There are at least two separate group actions to employment tribunals, each involving hundreds of ex-employees.
Law firm Simpson Millar is representing 500 former workers, while SDM Legal is taking action on behalf of almost 300 people. If successful, the pay-outs would be made through the Government Insolvency Service.
SDM is representing staff who worked at a number of stores in England and Scotland, offices in Taunton, Somerset, and the company’s warehouse and distribution centre in Peterborough.
A spokesman said: ‘Some of our clients have worked for Debenhams for their entire working life and so the administration, the way in which the redundancy process was handled and the widely-reported issues regarding the alleged pension deficit is a devastating reality.’
The maximum award per claimant is 90 days’ pay – with each award varying depending on each individual salary.
If the tribunal is successful, the Government will underwrite up to eight weeks of the 90 days. Payments for those made redundant after April 6 this year are capped at £544.
One affected worker, who had a 20-year career at a store in Scotland having started part-time as a teenager, said: ‘We were working in the stores packing online orders during lockdown but at the beginning of March we were given just a day or two’s notice that we were losing our jobs.
‘We were simply given details of how to apply for the Government’s statutory redundancy scheme, then that was it. The administrators washed their hands of us.’
Staff who were at work were told the news in person while others were invited to join a video call.
The worker, who has since found a new job, received £6,000 in statutory redundancy pay but argues he should have received 12 weeks rather than days’ notice – allowing him time to find a new job – along with payments to reflect his years of service.
He added: ‘There were people with mortgages, two or three kids, couples who were both losing their jobs at the same time. The cut to pensions as well is a very bitter pill to swallow, to be sure.’
Debenhams’ administrators, FRP, said it was difficult to abide by the statutory consultation period as decisions had to be taken on a day-by-day basis including sudden needs to reduce costs.
A spokesman said: ‘In normal circumstances an employer proposing to make redundancies would embark on a period of consultation with its employees.
‘But this is rarely possible in insolvency where the options available are limited, particularly in an unpredictable and challenging trading environment.’
However, Damian Kelly, head of employment law at Simpson Millar, said: ‘While many people would as-sume that Debenhams would not have to follow the correct employment procedures because it had gone into administration, they still have a duty under current employment law legislation to carry out a proper consultation with staff at risk of redundancies.’
‘Cast adrift with nothing’
Debenhams staff laid off with just a few days’ notice say they were ‘cast adrift with nothing’.
Claire Francis, restaurant manager at the branch in Carmarthen, West Wales, who had worked for Debenhams for 22 years, said: ‘The administrators could have let us stay on furlough to enable us to look for other employment rather than cast us adrift with nothing – especially as many employees had put in 20 years or more of loyal service.
Life-long service: But Claire Francis and Sue Ralls were laid off from their jobs a Debehams with just a few days notice
‘We were not given the legal 45 days consultation period required to enable us to look for alternative employment. Just a scripted phone call from the store manager and then putting the phone down as soon as the message was delivered, pretty poor behaviour by any standards.’
Listening in to the call to her team, she said it was ‘very upsetting, just to hear how shocked they all were’.
She added: ‘I had just enough time to thank them for their hard work and support before we were cut off. ‘
The 61-year-old is now working as an office administrator but faces a shortfall in her pension, which adds ‘insult to injury’, she said..
Sue Ralls, a store trainer who worked for Debenhams for 30 years is, like Francis, represented by Simpson Millar. She said: ‘I realise we were in a pandemic but it’s not a nice way to go.’
The 60-year-old faced a torrid employment market last May and said she applied for ‘about 36 jobs’.
She went back to college to take NVQs and is working in community support. She said: ‘My main worry was getting a job at 60. But the job I do now is so rewarding I should have done it years ago.
‘As the saying goes, you come back stronger. She said losing her job with a few days’ notice and then facing a pension cut ‘felt a cruel ending to a life career’.
‘I suppose the nearest thing it resembles is a divorce with losing a big share of the house,’ she said.