Former employees win tribunal claim against defunct groundworks firm

Ex-employees of Bowie Construction have been awarded payouts by an employment tribunal.

Twelve workers brought the claim against the former groundworks specialist, which went into administration in June 2024, on the basis that it did not hold a formal consultation process.

The company ceased trading in March 2024 and the tribunal found that it had dismissed its employees without notice, in breach of the Trade Union & Labour Relations (Consolidation) Act 1992.

Regional employment judge George Foxwell awarded the former workers 90 days’ pay – the amount they would have received if a consultation had been held before their redundancies.

The case is the latest in a long line of similar actions taken against defunct contractors following a test case in January 2021 involving Carillion.

Cash awards in such cases are paid out by the taxpayer-funded Redundancy Payments Service, rather than the former company.

The judge said that administrators for Bowie responded to the tribunal process and gave consent for the awards to be made.

The Cambridgeshire company turned over £14.5m and made a pre-tax loss of £996,830 in its final set of accounts, which covered 1 January to 30 December 2022.

It shortened its accounting period by a day prior to filing the results.

Among its projects were three subcontract packages for Morgan Sindall-owned Lovell Homes on housing jobs in King’s Lynn, for client West Norfolk Borough Council, one of which completed shortly before it went under.

Last year, administrators revealed it owed £4.4m when it collapsed, including £2.2m to its supply chain and £395,000 to former employees. Among its other debts was an outstanding balance of £204,545 to Lloyds Bank for borrowings made under the Coronavirus Business Interruption Loan Scheme (CBILS).

Quantuma estimated it would only be able to pay out around £400,000 to cover all of its debts.

In March, Construction News revealed that only 37 per cent of the building sector’s CBILS loans, which were made available as emergency support during the pandemic, had been paid back to date, with one commentator describing it as construction’s “forgotten debt burden”.

Linton-based Bowie was incorporated in 2007. According to its former website, it carried out road and sewer construction, paving and fencing as well as groundworks, and worked as both subcontractor and main contractor.