A group of former employees who worked for a claims management company has started legal action because they were “not given the right consultation” over their right to redundancy pay.
The Pure Business Group employed 265 employees at its offices in Liverpool and Prescot, Merseyside. A total of eight companies in the group are now in administration and some 203 staff were made redundant. The staff currently involved in the litigation are understood to have worked for the Pure Legal division.
Pure Legal had focused on personal injury claims and had switched to other areas, including negligent wall insulation claims, mortgage miss-selling, housing disrepair, and data breaches.
Solicitors Simpson Millar is now representing 30 former workers who believe they were not fairly treated when claiming redundancy pay. Anita North, an employment law specialist, said: “Unfortunately, the collapse of Pure Legal has left many former employees without work with no time for preparation, this stress is likely to be amplified given the current climate.
“Regardless of whether a company is struggling financially, they still have a duty under current employment law legislation to carry out proper consultation with staff at risk of redundancies. Where that does not happen, employees can bring a claim for a protective award.”
A protective award is a payment awarded by an Employment Tribunal when an employer does not follow the correct procedure when making 20 or more redundancies.
If the Employment Tribunal finds in the favour of the employees, they will be able to access the funds from the Government’s Insolvency Service.
It is understood the administration was triggered by Novitas Loans, which provided funds for legal proceedings, and had started insolvency proceedings against Pure Legal.
The Pure Business Group is owned by entrepreneur Phil Hodginkson, a former director at law firm Slater and Gordon and Compass Costs. He is also chairman of the Huddersfield Town Football Club. It was reported that other businesses in the wider group are not affected by the administration.
The football club issued a statement saying: “Our board of directors would like to assure Town fans that the club remains able to meet its financial commitments over the short, medium, and long term.”