Eighty-nine former staff of the failed Metamorph Group are pursing legal action to secure missed redundancy payments. Two separate group claims are being pursued on behalf of ex-employees after the group and various law firm businesses under its umbrella shut down at the start of this year.
Employment partner and solicitor Alan Lewis, of Manchester firm Pearson Solicitors and Financial Advisers, is leading the protective award claims on the basis the correct redundancy procedures were not followed.
‘Sadly, many firms in the legal sector are facing troubled times and increasingly entering insolvency situations,’ said Lewis. ‘However, insolvency in itself does not excuse an employer of following the correct procedures before making staff redundant.’
Metamorph collected a network of 15 offices and 650 professionals through a series of acquisitions but was placed into voluntary liquidation in November. Knowles Benning – which had absorbed many of the group’s staff and work in progress – was shut down by the SRA in December.
The first action is on behalf of employees of MGSL, mostly staff who worked in support services such as HR, IT, marketing and compliance, with 70 employees in that cohort. The claim has been commenced in the Manchester Employment Tribunal (pictured) and Pearson is currently dealing with directions.
The second group, consisting of 19 mostly fee-earning staff, is on behalf of former employees of Knowles Benning and has been commenced in the Midlands West tribunal. These proceedings have been automatically stayed as a result of the compulsory liquidation, but an application is being made for permission to continue the claim.
If successful, the employees are likely to be added to a list of preferential creditors. If a company has gone bust and the employer cannot pay a redundancy award, then the government steps in and guarantees eight weeks’ pay, currently capped at £643 per week less any arrears of pay received from the Redundancy Payments Office.
An action to strike Metamorph Group off the register of companies was suspended last month after an objection was received by the registrar.
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