Workers who lost their jobs when Leeds-based marketing agency Brass went into administration last week have begun the process of taking legal action against the company following allegations that it failed to properly consult staff when making redundancies.
A total of 60 members of staff are said to have been left unemployed after the firm called in administrators, with some staff reportedly notified that the agency had ceased trading and sent home with immediate effect.
The move has prompted some ex-employees to contact employment law specialist Simpson Millar to investigate allegations that the business had failed to properly consult staff when making redundancies, which will result in legal action being brought in order to secure a Protective Award for those affected.
Stephen Pinder, an employment law partner at Simpson Millar, which has an office in Leeds, said: “This is no doubt a very upsetting and distressing time for the former employees of Brass.
“We have already received calls from several people who have been affected by the news, and who are looking to pursue a Protective Award which, if successful, will see them compensated by up to 90 days’ gross pay, albeit likely capped at £4,200 given the company’s administrative state.
“To be entitled to this, formal legal action must be brought against Brass and an Employment Tribunal Judgment obtained which will rule on whether there was a failure by an employer to follow the correct procedure when making redundancies.”
The firm has now set up an eligibility trackerwhich will enable former Brass employees to determine whether they are entitled to make a claim.
Mr Pinder says that the speed at which they were contacted by staff was indicative of increased awareness among workers of their rights when it comes to the collapse of an organisation.
He said: “Historically, people have assumed that if a business goes bust that’s it. The staff are out of a job, and there’s nothing that they can do about it.
“However, with so many large organisations entering administration, and high-profile cases such as Thomas Cook going into compulsory liquidation, there is an increased awareness amongst workers about what the correct, and indeed the incorrect, process is when making redundancies.
“Where business fail in their legal obligation staff do still have rights, and where an Employment Tribunal finds in the favour of the employees they will be able to access the funds via the Government Insolvency Service.”
Gareth Harris and Keith Marshall of RSM Restructuring Advisory were appointed joint administrators of Brass Agency Limited on November 29.
Brass provided a full range of marketing services to local, national and global organisations. The Leeds-based business employed over 60 members of staff, when administrators were called in.
All staff were paid up to the date of cessation of trade on November 28, 2019, according to the administrators, and that their claims will be dealt with by the Redundancy Payments Service (RPS).
Administrators said the firm faced increasing cash flow pressure during recent months and that directors sought to secure additional finance and sell the company’s freehold property. However, this was not possible in the time available.
They therefore took the decision to cease trading and commence the process to place the company into administration.
Mr Harris, RSM Restructuring Advisory partner and joint administrator, said: “Despite the best efforts of the directors to seek alternative funding and to sell the company’s freehold property at the level required to eradicate the company’s cash shortfall, it was unfortunately not possible to achieve in the time available.
“All employees have been paid up the date of their redundancy.”