Shanahan Engineering Ltd v Unite the Union UKEAT/0411/09

Shanahan, a construction contractor, had to stop work on one of two construction projects with very short notice from its client. This led to redundancies having to be made. Shanahan claimed that it was not reasonably practicable for it to comply with its obligations to consult with employees in good time under s. 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 and that these were “special circumstances”.

The EAT held that the obligation to inform and consult still remained in whatever little time was available. The “special circumstances” did not however absolve Shanahan absolutely from the obligation to consult. Shanahan were therefore liable to pay a protective award to the redundant employees as it was in breach of the consultation process. The Tribunal had been wrong however, to order the maximum 90 day protective award. The case was remitted for further consideration of the amount of the protective award to be paid to each redundant employee.

Key point: This case suggests that it will be difficult for an employer to establish the “special circumstances” defence except in very narrow circumstances.