Tribunal orders 90-day protective awards for 1,687 workers dismissed as ISG collapsed

An employment tribunal has found that four companies in the collapsed British contractor ISG failed to consult collectively before making their staff redundant, and has ordered protective awards covering 90 days for 1,687 former employees. The judgment, given by Regional Employment Judge Pirani, is dated 13 March 2026 and was sent to the parties on 20 March 2026. It was published on the government's employment tribunal decisions register on 17 April 2026, under case number 2228523/2024 and 1,686 others.

The claims were brought under section 189 of the Trade Union and Labour Relations (Consolidation) Act 1992, which lets employees complain when an employer breaches the consultation duty in section 188. That duty applies when an employer proposes to dismiss 20 or more employees at one establishment within a period of 90 days or less, and it requires consultation to begin at least 30 days before the first dismissal takes effect, or at least 45 days where 100 or more employees are affected. The tribunal held that each of ISG Central Services Limited, ISG Construction Limited, ISG Interior Services Group UK Limited and ISG Retail Limited failed to comply with section 188, and ordered each to pay a protective award for a protected period of 90 days beginning on 20 September 2024.

The claimants are listed in four schedules to the judgment: 285 claims against ISG Central Services, 634 against ISG Construction, 496 against ISG Interior Services Group UK and 272 against ISG Retail. All were dismissed on or within 90 days of 20 September 2024, the day administrators from EY-Parthenon were appointed. Construction Enquirer reported that day that 2,200 staff were made redundant immediately, with about 200 retained to help wind the business down across eight UK trading entities.

The judgment was entered by consent under rule 62 of the Employment Tribunal Procedure Rules 2024, so it carries no contested findings of fact and no reasons beyond its own terms. It records that the Secretary of State for Business, Energy and Industrial Strategy, joined as fifth respondent, had raised three issues in response: establishment, representatives, and whether there was any consultation. The tribunal resolved all three in the claimants' favour. All remaining claims, including unfair dismissal, constructive dismissal, arrears of pay, holiday pay, redundancy pay and notice pay, were dismissed upon withdrawal, and each party bears its own costs.

A protective award ordered against an insolvent company is worth considerably less than its length suggests. Section 184 of the Employment Rights Act 1996 makes a protective award recoverable from the National Insurance Fund as arrears of pay, but it caps arrears at not more than eight weeks, and each week is limited to a statutory maximum. Ninety days is roughly thirteen weeks. Construction Enquirer reported in May 2025, when about 1,650 claims had been lodged, that the maximum any one person could receive was 5,600 pounds and that the cost to the state could exceed 9 million pounds. Its March 2026 report on the outcome gave the same figures. The applicable weekly cap is the one in force when the job ended; the government's current guidance states that for redundancies on or after 6 April 2026 weekly pay is capped at 751 pounds.

The judgment states that any payments made by the companies rather than by the Secretary of State will be paid as an unsecured dividend, subject to the normal categories of preferential debts under the Insolvency Act 1986, and that the 1996 recoupment regulations apply to the award. Administrators reported in December 2024 that they had identified about 35 million pounds against debts of roughly 1.1 billion pounds, and that there would be no cash for trade contractors owed at least 308 million pounds. On that arithmetic the unsecured portion of a 90-day award is close to theoretical.

The statutory ceiling has since moved. Section 189 now provides that the protected period shall not exceed 180 days, doubled from 90 days by the Employment Rights Act 2025 with effect from 6 April 2026. The ISG dismissals took effect in September 2024, so the old 90-day maximum applied, and the tribunal ordered that maximum. Nothing in the amendment alters the eight-week limit on what the National Insurance Fund will pay.

The counts do not agree across the record. Construction Enquirer reported 1,650 claims in May 2025, out of what it described as 2,400 former employees. Construction News headlined the March 2026 outcome as 1,700 ex-ISG staff. The schedules to the judgment total 1,687. The judgment does not say how many of the dismissed workforce never claimed, or why. It is not known when the Redundancy Payments Service will pay, how many claimants will reach the eight-week cap, or whether the unsecured balance will ever yield a dividend. Nor is it known whether a 180-day ceiling will change the conduct of directors who place a business into administration knowing that the state meets only the first eight weeks.