Mortons Rolls Workforce Win Over £1 Million in Redundancy Payments

Published : December 8, 2025

More than 100 former employees of the Scottish baking firm Mortons Rolls will receive a share of over £1 million in redundancy payments after a drawn-out court battle with the UK government. 

Hundreds of Employees Abruptly Dismissed

Originally founded in 1965, Mortons Rolls operated out of the Drumchapel area of Glasgow, employing hundreds of staff, some for several decades. Announcing its unexpected collapse, workers were abruptly dismissed in 2023 when the company went into administration. After an initial refusal by the UK government to cover statutory redundancy payments, the decision has since been overruled by the Employment Appeal Tribunal.

The appeal decision awards former employees £500,000 in cash compensation with a further £500,000 in protective payments. The resolution brings the protracted dispute to a close.

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New owner John McIlvogue responded to the appeal decision.

“After two years in limbo, finally, the former employees of Mortons Rolls will receive their long-overdue redundancy payments. I stepped in to rescue the iconic Mortons Rolls bakery from liquidation and to rehire as many of the former bakery workers as I could to start rebuilding the business. Despite an employment tribunal ruling that the responsibility for legacy redundancy payments from when Mortons fell into administration did not rest with Phoenix Volt Ltd, the UK Government lawyers decided to challenge that decision and needlessly drew out the process for two years – delaying the payments to former employees, many of whom have been left in dire straits.”

If you believe your employer may have breached your statutory rights, contact Redmans Solicitors. Our experienced team of employment specialists is here to help. After a brief chat, we can answer your queries and discuss potential next steps. 

To get in touch, simply: 

Redundancy Payments Dispute: The Mortons Rolls Case

Announcing its shock administration in March 2023, Mortons Rolls made over 200 employees redundant. Redundancies were made without either collective consultation or payment of statutory redundancy pay, despite many of the workers having been employed by the company for years, some for decades. 

Around the same time, the company was sold to Phoenix Volt Ltd, by which point it had officially stopped trading, frozen its accounts, and made its staff, including bakers, drivers, and factory workers, redundant. Phoenix later reopened trading and rehired over 100 of the original employees of Mortons Rolls. Other former employees sought statutory redundancy payments from the government’s National Insurance Fund. 

Refusal of Statutory Redundancy Payments

In response to the original claims, the UK government refused statutory redundancy payments on the basis that the business had been transferred under the rules of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE). It argued that these regulations meant that the workers’ employment had also passed to Phoenix Volt, leading them to propose that the new owner should be held liable for more than £2 million in payouts. This was upheld in the initial tribunal hearing.

Decisions of the Employment Appeal Tribunal

Following an appeal, however, the Employment Appeal Tribunal overturned the decision. It ruled that a transfer of business had happened only after the company entered official insolvency, and as such, employment did not transfer to the new owners. Workers would therefore be eligible for statutory payments from the government’s National Insurance Fund. 

More than 100 former employees are set to receive a sum from the £1 million+ compensation package, comprising £500,000 in cash and a further sum awarded as protective payments. 

Understanding Redundancy Payments, TUPE and Protective Awards

Redundancy Payments

Employees may still be entitled to redundancy payments from the government’s National Insurance Fund in the case of a business collapsing before a genuine TUPE transfer takes place. Originally, the government refused redundancy payouts to former Mortons Rolls employees based on its assertion that the TUPE had transferred all employees to the new owner. This transfer left the new owner liable to employees rather than the state. Since then, the Employment Appeal Tribunal has overruled this decision, confirming that the transfer happened later. This, therefore, returns liability to the government. 

TUPE Transfer

The appeal decision makes clear that a transfer does not occur simply through the signing of a contract. The new owner must, in fact, take real control of the business for a genuine TUPE transfer to take place. This protects employees who have been dismissed before a new buyer takes real control, offering them statutory protections. 

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John McIlvogue reacted to the decision of the Employment Appeal Tribunal by saying:

“It’s a weight off my mind, and we can now focus on expansion plans without this hanging over us. It was ludicrous for the UK Government to take such a stance when the redundancy payments all related to the company that ­previously owned the business. No new owner could have bought Morton’s in 2023 if they would have been saddled with that kind of liability.”

Protective Awards

A protective award compensates employees where an employer fails to carry out the required collective consultation before large-scale redundancies. In Mortons Rolls, no consultation was undertaken, leading the tribunal to confirm the protective award remained valid.

What Employees Can Do If Their Rights Are Breached 

A breach of statutory rights may include refusal of redundancy payments, failure to consult, or failure to give notice, among other things. For employees who find that their statutory rights have been breached, there are several avenues to explore:

Statutory Redundancy Claim

Employees can proceed with a claim to the Insolvency Service in order to claim statutory redundancy pay, unpaid wages, holiday pay or notice pay. These claims are processed through the RP1 claim system. 

Read More: Understanding Employee Rights When an Employer Goes Insolvent 

Employment Tribunal

Employees may decide to make a claim with the Employment Tribunal to challenge unfair dismissal, lack of proper notice, incorrect redundancy selection or potential discrimination in redundancy. It should be noted that there is a deadline attached to this type of claim, normally 3 months minus 1 day. Furthermore, in most cases, Acas early conciliation must be undertaken first.

Protective Award

Employees may have had their rights to consultation breached. This happens when employers make 20 or more redundancies within 90 days without proper consultation. In this instance, employees can bring a protective award claim similar to the claim brought in Mortons Rolls. Alternatively, they can claim unfair dismissal if they allege that dismissal was rushed or undertaken without proper procedure. 

Insolvent Employer

If the employer is insolvent, an employee can still seek a resolution. They can choose to make a claim from the National Insurance Fund payments. In addition, they can bring a claim against the insolvency practitioners. 

Where relevant, employees can also speak to their union. Unions may proceed with group claims, negotiate protective awards, or seek other legal advice. 

Redundancy Payments: Get Help with Redmans

If you believe that your statutory rights have been breached or that you have a redundancy claim, talk to us. Redmans Solicitors are experts in the employment sector. Our solicitors would be happy to assess your case, answer your queries and present potential options to move forward. Where relevant and eligible, we can also guide you through the legal process to ensure you achieve an optimal outcome. 

To talk to us and find out what we can do to help, simply: 

The information on this page is intended for general informational purposes only and does not constitute legal advice.