Kesslers staff to take action over redundancy consultation

Richard Stuart-Turner
Wednesday, January 12, 2022

Staff affected by the collapse of retail display specialist Kesslers International have begun the process of taking legal action amid allegations that the business failed to properly consult staff during the redundancy process.

Kesslers began trading in 1888
Kesslers began trading in 1888

The Stratford, East London-based business, part of the Hexcite Group, went into administration last month due to the impact of the coronavirus pandemic on the retail sector and cost inflation.

Printweek has heard from two law firms on the claims.

Simpson Millar said it had been contacted by “several former workers” who claimed they were not consulted over the job losses. The firm’s specialist employment team has now started investigations and is looking to secure a Protective Award for those affected.

A Protective Award is a payment awarded by an Employment Tribunal in cases where an employer fails to follow the correct procedure when making 20 or more redundancies and, where the tribunal finds in the favour of the employees, they will be able to access the funds of up to £4,352 via the government’s Insolvency Service.

Simpson Millar employment law expert Anita North said: “Regardless of whether a company is struggling financially, they still have a duty under current employment law legislation to carry out a proper consultation with staff at risk of redundancies. Where that does not happen, employees can bring a claim for a Protective Award.

“While the process to claim for a Protective Award will not result in an influx of cash immediately, legal protection remains in place to support people who are made redundant without being taken through the correct consultation process, and the money recovered in successful claims will provide some longer-term security for those affected.”

Printweek was informed that as the case will need to be heard by an Employment Tribunal, and there are currently backlogs, there is no set time for how long this process is expected to take.

Terry Jones Solicitors, part of Metamorph, has also heard from ex-employees of Kesslers and said it believes that several individuals may still not be aware of their right to claim.

Metamorph national head of employment Alan Lewis told Printweek: “We have been contacted by approximately 10 employees and believe approximately 160 staff are affected in total.

“From the discussions we have had, no proper consultation took place prior to the employees being made redundant without notice. Regrettably, this is pretty commonplace when a company enters administration.”

He said this type of claim is of great importance to workers who had not been employed for more than two years at Kesslers, because unlike the statutory redundancy payment claim, they are able to make a claim for a Protective Award having under two years of service.

Lewis added the main factor influencing what the former staff could receive would be being successful in an Employment Tribunal claim and dealing effectively with the tribunal process and any case management directions.

“Many claims are struck out for non-compliance with directions. A claim can only be made to the government once a judgment is obtained against the company following a successful Employment Tribunal claim.”  

In the event of a successful claim, he said each employee is likely to receive an award of 90 days’ pay.

“Whilst the company in administration is unlikely to have the funds to satisfy the whole of this award, the government effectively guarantees a proportion of the award of up to eight weeks’ pay, capped at a maximum of £544 per week.”

Hexcite’s private equity fund owner Elaghmore said it had not been contacted on the matter by any lawyers at the time of writing and could therefore not offer any comment to Printweek.

£25m-turnover Kesslers began trading in 1888 and is the UK’s oldest POP designer and manufacturer. It provides bespoke POS retail equipment, including design, technical engineering, manufacturing, installation, and post-campaign customer service.

There has been no update on the progress of the company’s administration since the news was revealed. None of Hexcite’s other businesses are affected.

Hexcite Group was created by Elaghmore in 2019. It acquired Blaze Signs in September 2020. Another Hexcite business, Shopfittings Direct, went into administration in November 2019. In June 2021 the business appointed a new group chief executive, Wes Mulligan.

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