Former employees of a Scottish-based software development house
last week submitted an £8m claim for damages from their ex-employer
after they were dismissed without notice or compensation following
the sale of the company in June.
The 220 former staff of software development house TelesensKCSL
received no salary for June and were made redundant without notice,
consultation or redundancy payments by receivers Deloitte &
Touche.
Because employees on maternity and sick leave were among the group,
the class action is seeking recompense for both unfair dismissal
and sex discrimination.
The action has gained the support of MPs in both the UK and
Scottish Parliaments and has been the subject of an early day
motion in the Scottish Parliament, with a call for a Department of
Trade & Industry inquiry.
TelesensKCSL, which was among the leading developers of telecoms
billing systems, with customers including 02, announced to staff on
25 June that it was to be put into receivership.
The news came despite assurances just days before that there was
more than c6m (£3.8m) in the bank for staff salaries and a number
of interested potential buyers.
Three days later, the company was sold for $10m (£6.4m) to US firm
Convergys and the receiver Deloitte & Touche made 220 staff
redundant, informing them that there was no money in the bank to
pay them.
The action is being fought by employment law firm Roydens and is
being investigated by the Equal Opportunities Commission and the
DTI.
Lawyer David Royden said, "This is a case of plain bad behaviour on
the part of Deloitte & Touche. Legislation making it illegal to
dismiss employees during a transfer of employment has been around
for nearly 20 years.
"It is possible for exceptions to be made for economic, technical
or organisational reasons as long as it is carried out in a fair
and reasonable manner. Gathering 220 people in a room and summarily
dismissing them without notice or pay is clearly unfair and
unreasonable behaviour."
Former TelesensKCSL employee Mike Cicero, a spokesman for the class
action group, said, "Not only are we seeking the money that is owed
to us, we are also hoping that by taking this action we can force
changes in the law so that this does not happen to anyone else ever
again."
Nigel Griffiths, MP for Edinburgh South and minister for small
business, said, "The information given to me by my constituents
makes me highly suspicious of the motives and operations of the
company. I have asked the DTI to investigate the collapse of
TelesensKCSL and advise on what action, if any, can be
taken."
Edinburgh-based KCSL was acquired by German-headquartered Telesens
in 2000 in a £129m deal. The cash crisis at the merged company
arose when the firm's bankers Royal Bank of Scotland and Bank of
Scotland refused to allow the Scottish arm to transfer funds to
Germany.
Deloitte & Touche and Convergys declined to comment on the
case.