City Link - Prosecution of Directors for Failing to Consult

City Link - Prosecution of Directors for Failing to Consult

5 November 2015

RMT Press Office

Role of Other Better Capital Directors

Today Thursday 5 November and Friday 6 November, three directors of logistics firm City Link - CEO David Smith, finance director Robert Peto as well as Thomas Wright are before the courts. The three are expected to set out why they believe they are not guilty of the charge of failing to consult with staff ahead of the Christmas 2014 collapse of the company.
 
The elephant not in the room is Jon Moulton, founding director of Better Capital - the company which withdrew the funding on which City Link relied. Jon Moulton was not a director of City Link and so was not under a duty to consult with employees. However, what role he had, if any, in the decision not to consult remains a mystery – which hopefully the three City Link directors being prosecuted can clarify.
 
Jon Moulton has already made clear his views on the importance of observing the legal duty to consult. When before the enquiry held by the joint Parliamentary Scottish Affairs and Business, Innovation and Skills committees there was the following exchange:
 
The Chair of the committee – Ian Davidson, then MP for Glasgow South West, asked:
You [Jon Moulton] said that in your view...the company was doomed late in the autumn. You could have started consulting then.
Jon Moulton responded:
You could; if you really want to see a company fail very quickly, you can consult with your staff about redundancy well before the date.
See Q222 http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/scottish-affairs-committee/impact-of-the-closure-of-city-link-on-employment/oral/17836.html:

 
RMT General Secretary Mick Cash said:
“Between 22nd December and 26th December 2014, City Link spent £463,000 on lawyers and accountants – the vast majority of that sum went on lawyers.
“In the coming days we may gain an insight into whether at least three City Link directors think that money was well spent.
 
“However, the City Link workers induced to do overtime for which - partly due to such high expenditure on ‘professional fees’ - they will never be paid, already know the answer.”
 
ENDS

Want to receive updates from us? Subscribe to a mailing list

Tagged with: city link, better capital