Three City Link directors charged under labour legislation

Three former directors of City Link, which went bust in 2014, have been charged under employment law for closing down the business without going through proper legal processes in making the company’s staff redundant.

Under UK law, employees of a company must be given 30 days’ notice of redundancy. Further, where a business has more than 20 workers in any establishment the company that is winding up must inform the business secretary before going ahead. In City Link’s case the announcement of the closure came on Christmas Eve and the business was closed down a week later.

The directors, former managing director David Smith, former finance director Robert Peto and former non-executive director Thomas Wright, have been charged with failing to notify the business secretary of the closure of the business. They will go on trial in November. If found guilty they face fines of £5000 each.

The UK government’s Insolvency Service has handled many of the redundancy claims, which in many cases have amounted to 90 days pay per employee. 250 former staff are going to an Employment Tribunal to settle their issues with the company as well.