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The Independent has uncovered that The Body Shop has violated employment regulations by abruptly terminating the contracts of hundreds of employees.
The company’s managers terminated approximately 270 employees at the main office last Tuesday. They informed them through Microsoft Teams that they would not receive pay after that day, and the company would not offer any type of severance benefits.
The terminated workers, including those with over ten years of service, were instructed to seek unpaid compensation and vacation pay from the government-funded Redundancy Payments Service. Additionally, another 489 positions were eliminated and 75 stores were shut down on Thursday.
Former employees who were let go were instructed to request their overdue salaries and vacation pay from the government-funded Redundancy Payments Service.
Last week, workers expressed their dissatisfaction with the “brutal” meeting held on Teams. They stated that their abrupt termination from Body Shop International Ltd had negative impacts on their financial and mental well-being. One employee shared with The Independent that they were on the brink of losing everything due to the actions of a company that previously emphasized ethics and community.
At least 15 women who are on or about to start maternity leave will now only receive government maternity pay, instead of the packages they were initially offered while working at Body Shop. This information was confirmed by a new mother who was recently laid off.
“When I discovered I was expecting, the excellent maternity benefits offered by [the Body Shop] gave me hope and I am aware that it has had a similar effect on other mothers,” stated another woman. However, she also expressed concern that the current circumstances have caused a significant strain on her family’s finances, especially with her due date approaching in just a matter of weeks.
A staff member with a 13-year tenure at the firm stated that the abrupt termination of their salary would not be enough to cover their family’s expenses for February. They expressed their disappointment at the way they were treated and noted that it had negatively impacted many others as well.
One individual expressed that their “ultimate goal” was to be employed in March, but instead they were on the brink of losing everything due to a once-esteemed company’s apparent disregard for ethics and community. They further stated, “In my entire career, I have never faced such mistreatment.”
Last week’s Teams call with employees revealed that their abrupt termination from Body Shop International Ltd was causing them financial and emotional distress.
They have requested jobseeker’s allowance, a reduction in council tax, and intend to negotiate with their mortgage provider for a six-month period with no interest in order to maintain their housing. They express frustration and disbelief at their treatment and question how those responsible can live with themselves.
After receiving criticism from former employees through an email campaign, FRP Advisory administrators have confessed to not adhering to standard protocols in regards to consulting with employees or their representatives before terminating their employment. They have justified this by claiming that they did not have enough time to do so.
Managers stated in their reply, which was received by The Independent and represents the Body Shop, that they did not properly seek the input of employees, as they believed it was necessary to quickly decrease head office payroll expenses. They referenced their legal obligation to make decisions that will benefit all creditors of the company.
“The email acknowledges a conflict between the obligations towards employees and creditors,” explained attorney Nick Humphreys from Penningtons Manches Cooper. He added that the administrators seem to be admitting to violating their duties towards employees.
Tina Maxey, an employment attorney at Ellisons Solicitors, stated that companies facing financial difficulties often neglect their employees’ rights due to the obligation of directors to prioritize maximizing their creditors’ profits.
According to Solicitor Michael Newman from Leigh Day, it may be worth considering if the law effectively balances the rights of both creditors and employees in such cases. He also expressed concern that creditors may be given more importance, despite employees having dedicated a considerable amount of time and effort to the company over the years. It is unfortunate that the law puts creditors first in these instances.
He commented on the unexpected termination of employees at the Body Shop, saying that it may demonstrate how the company has strayed from its original ethical principles despite its reputation for them.
According to Ms Maxey, not properly consulting staff is a violation of their rights, although it is not a punishable crime for administrators or the company. She also stated that as long as the company has informed the secretary of state about the redundancies, they have the option to collectively consult or not.
Workers are able to request for payment through a legal hearing if they were not adequately consulted. According to The Times, a collection of over 175 workers from Body Shop are planning to file a lawsuit with the assistance of Acas, the government’s advisory, mediation, and dispute resolution organization.
The Insolvency Service reported that they have been collaborating with the administrators of Body Shop to guarantee that employee claims can be dealt with and compensated as soon as possible. A representative stated, “The Redundancy Payments Service of the Insolvency Service will issue statutory redundancy and associated payments to assist qualified employees who have lost their jobs.”
FRP Advisory has been reached out for a comment.
Source: independent.co.uk
