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USDAW Welcomes Retailer Compensation Development

USDAW Welcomes Retailer Compensation Development

The Union of Shop, Distributive and Allied Workers (USDAW) has welcomed a new development in the compensation cases for Ethel Austin and Woolworths workers.

Bosses from the organisation praised the Court of Appeal for referring pleas for redress from staff members previously employed by the two brands to the Court of Justice of the European Union (CJEU).

All parties involved in the compensation battle will now, according to the union, reconvene at the Court of Appeal later today to decide what questions should be considered by judges in Brussels.

The main point of contention between the trusts left by Woolworths and Ethel Austin and the USDAW is that workers in stores with less than 20 employees were not given compensation, while colleagues in larger branches received some form of redress.

Woolworths went into bankruptcy on November 27th 2008 and within a matter of months administrators called in by Deloitte closed all of the chain's outlets, while Ethel Austin was shuttered in early 2010.

Both were affected by wider economic issues in the UK at the time, as consumers had less disposable income than in previous years, although retail experts agree that both businesses had serious underlying problems that could have left them in financial difficulty, even if the recession hadn't taken hold.

John Hannett, USDAW general secretary, said: "We are confident of our case, which is morally and logically robust. It makes no sense that workers in stores of less than 20 employees were denied compensation, whereas their colleagues in larger stores did qualify for the award. 

"These were mass redundancy situations where thousands of workers lost their jobs. We hope that this referral to the CJEU will ensure that justice can be done."

Administrators claim that, under British and European law, compensation did not have to be awarded to people from smaller stores as rules stipulated this exception could be made, although this point has been contested by both the USDAW and other critics, who claim the 3,200 employees affected were let down.

By Francesca Witney

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