The Body Shop has admitted violating labor law by laying off hundreds of people at any one time. The independent can reveal.
Managers at the troubled cosmetics company laid off about 270 head office employees last Tuesday, telling them via Microsoft Teams that they would not be paid beyond the end of the day and that the company would not provide them with any kind of package. of dismissal.
The laid-off employees – some of whom had worked there for more than a decade – were instead told to claim unpaid wages and holiday pay from the taxpayer-funded Redundancy Payments Service. Another 489 job losses and 75 store closings were announced Thursday.
Employees on last week's “brutal” Teams call said their sudden dismissal by Body Shop International Ltd was “affecting people financially and mentally”, with one of them saying The independent had left them “on the verge of losing everything for a company that once valued ethics and community.”
This includes at least 15 women who are on maternity leave or soon to have their baby, who will now only receive government maternity pay instead of the packages they were offered when they were Body Shop employees, according to a newly laid-off mother last week.
“When I found out I was pregnant, the good maternity package from [the Body Shop] “It's what kept me going and I know it's the same for other moms,” said another woman, who warned that the situation had “put enormous financial pressure on my family” just weeks before having her baby.
One employee who had worked at the company for 13 years said the sudden end to his salary meant his February salary wasn't going to cover his family's bills. “Receiving such poor treatment has taken its toll on many people affected,” they said.
Another said that being hired last March had been his “dream job,” only to be left “on the verge of losing everything for a company that once valued ethics and community,” adding: “Never in my life I have been treated like this before at work.”
(Bloomberg/Getty)
They have applied for unemployment benefits and a council tax reduction and said they plan to ask their mortgage provider to remain interest-free for six months “to keep the roof over my head”, adding: “How can they be allowed to let us try?” “This is beyond me, I don't even know how they can sleep at night.”
In response to an email campaign from laid-off workers, administrators at FRP Advisory have admitted that they did not follow “normal regulations” to properly consult employees or their representatives before laying them off, saying there was “not enough time.” ” to do it. .
The administrators argued in their response on behalf of Body Shop, seen by The independentthat they had not adequately consulted employees because a “rapid reduction” of headquarters wage costs was deemed necessary, citing their legal duty to take action for the benefit of all the company's creditors.
Solicitor Nick Humphreys, of Penningtons Manches Cooper, said that while the email notes there was a tension between duties owed to employees and creditors, the administrators appear to be admitting a breach of their duties to employees.
It is not uncommon for companies in financial difficulty to fail to respect the rights of their employees due to the duty of directors of such companies to maximize returns to their creditors, according to Tina Maxey, employment lawyer at Ellisons Solicitors.
Lawyer Michael Newman, of the firm Leigh Day, said he would “question whether the law has struck the right balance between creditors and employees” in such situations, adding: “Creditors will have invested money, but employees will also have invested money “. “A lot of time and work has been put into the company over the years and it is a shame that the law gives priority to creditors in this situation.”
Referring to Body Shop's sudden mass redundancy, he added: “For a company renowned for its ethical credentials, it perhaps shows how far it had come from its origins.”
Maxey said failing to properly consult staff was a breach of their rights but not a criminal offense by managers or the company, adding: “As long as you have notified the Secretary of State of redundancies, the company can now choose whether it consults collectively or not.”
However, employees can seek compensation through a court if they are not properly consulted, and The times reports that a group of more than 175 Body Shop employees are preparing to lodge a claim through Acas, the government's advice, conciliation and arbitration service.
The Insolvency Service said it had been working with Body Shop administrators to ensure employee claims could be processed and paid as quickly as possible. “The Insolvency Service's Redundancy Payments Service will make statutory redundancies and related payments to support eligible employees who have been made redundant,” a spokesperson said.
FRP Advisory has been contacted for comment.
