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<blockquote data-quote="flower" data-source="post: 155364" data-attributes="member: 27677"><p><h3>MPs Set to Grill Wilko Executives Following Retail Collapse</h3> <table style='width: 100%'><tr><td>By Flower</td></tr></table><p></p><p><strong>What's going on? </strong></p><ul> <li data-xf-list-type="ul">In August 2023, Wilko, a high street retail brand, announced that it would be going into administration and closing all 400 of its shops, putting 12,000 jobs at risk</li> </ul><p></p><ul> <li data-xf-list-type="ul">Wilko's executives have since come under fire after it was revealed that they paid out £77m in dividends to themselves and shareholders in the lead up to its administration</li> </ul><p></p><ul> <li data-xf-list-type="ul">On November 28, former Wilko bosses will appear in front of a Parliamentary Business and Trade select committee to answer questions about the events that led up to the failure</li> </ul><p></p><ul> <li data-xf-list-type="ul">This hearing was prompted by the trade union, GMB, which wrote to the select committee chair, Liam Byrne MP, asking him to hold Wilko to account</li> </ul><p><strong>Why is this important?</strong></p><ul> <li data-xf-list-type="ul">Wilko’s dividends payouts are being investigated by The Pensions Regulator, which is investigating a £56m deficit in the company’s pension fund. The Pensions Regulator has the power to pursue executives/owners to cover pension shortfalls if their actions are deemed a risk to pensioners' benefits, meaning litigation is not off the table.</li> </ul><p></p><ul> <li data-xf-list-type="ul">GMB union's national officer has alleged corruption among Wilko executives, accusing them of ignoring "all warnings about their company’s financial future – lining their own pockets and dishing out millions to shareholders before leaving 10,000 people jobless." Reputation-wise, Wilko's collapse might be seen as a story of corporate greed and could potentially lead to public pressure on Parliament to pass legislation regulating dividends payouts.</li> </ul><p></p><ul> <li data-xf-list-type="ul">The summoning of Wilko bosses to Parliament marks the intersection between business and the rule of law. Whilst select committees exist mainly to act as a check on the government's authority, the scope of their powers extends beyond the political sphere. As Parliament inquires into the conduct of Wilko executives next Tuesday, this drives home the point that no one is above legal scrutiny, not even the former leadership of a corporate giant.</li> </ul><p><strong>How is this relevant to law firms? </strong></p><p></p><p><em>Disputes</em></p><p>Should The Pensions Regulator bring a claim against Wilko's former executives, a law firm like Herbert Smith Freehills may be instructed to prepare a subsequent defence. This preparation will be led by their litigation team and will consist of investigating any allegations brought forward by the regulator, preparing court submissions, instructing a barrister, preparing witness interviews, etc. The litigation team may work closely with HSF's regulatory team to ensure they are well-informed on regulations surrounding pension fund management and corporate governance.</p><p></p><p><em>Employment</em></p><p>Law firms may be instructed to provide employment advice relating to the 12,000 jobs at risk. Firms like Simmons & Simmons, for example, might specifically advise on whether Wilko was labour law compliant before and during administration ( if, for example, Wilko executives cut corners by not providing advance notice to employees where there was an obligation to do so, etc). The firm might also advise on whether Wilko is under any legal obligation to pay compensatory employment-related rewards.</p></blockquote><p></p>
[QUOTE="flower, post: 155364, member: 27677"] [HEADING=2]MPs Set to Grill Wilko Executives Following Retail Collapse[/HEADING] [TABLE] [TR] [TD]By Flower[/TD] [/TR] [/TABLE] [B]What's going on? [/B] [LIST] [*]In August 2023, Wilko, a high street retail brand, announced that it would be going into administration and closing all 400 of its shops, putting 12,000 jobs at risk [/LIST] [LIST] [*]Wilko's executives have since come under fire after it was revealed that they paid out £77m in dividends to themselves and shareholders in the lead up to its administration [/LIST] [LIST] [*]On November 28, former Wilko bosses will appear in front of a Parliamentary Business and Trade select committee to answer questions about the events that led up to the failure [/LIST] [LIST] [*]This hearing was prompted by the trade union, GMB, which wrote to the select committee chair, Liam Byrne MP, asking him to hold Wilko to account [/LIST] [B]Why is this important?[/B] [LIST] [*]Wilko’s dividends payouts are being investigated by The Pensions Regulator, which is investigating a £56m deficit in the company’s pension fund. The Pensions Regulator has the power to pursue executives/owners to cover pension shortfalls if their actions are deemed a risk to pensioners' benefits, meaning litigation is not off the table. [/LIST] [LIST] [*]GMB union's national officer has alleged corruption among Wilko executives, accusing them of ignoring "all warnings about their company’s financial future – lining their own pockets and dishing out millions to shareholders before leaving 10,000 people jobless." Reputation-wise, Wilko's collapse might be seen as a story of corporate greed and could potentially lead to public pressure on Parliament to pass legislation regulating dividends payouts. [/LIST] [LIST] [*]The summoning of Wilko bosses to Parliament marks the intersection between business and the rule of law. Whilst select committees exist mainly to act as a check on the government's authority, the scope of their powers extends beyond the political sphere. As Parliament inquires into the conduct of Wilko executives next Tuesday, this drives home the point that no one is above legal scrutiny, not even the former leadership of a corporate giant. [/LIST] [B]How is this relevant to law firms? [/B] [I]Disputes[/I] Should The Pensions Regulator bring a claim against Wilko's former executives, a law firm like Herbert Smith Freehills may be instructed to prepare a subsequent defence. This preparation will be led by their litigation team and will consist of investigating any allegations brought forward by the regulator, preparing court submissions, instructing a barrister, preparing witness interviews, etc. The litigation team may work closely with HSF's regulatory team to ensure they are well-informed on regulations surrounding pension fund management and corporate governance. [I]Employment[/I] Law firms may be instructed to provide employment advice relating to the 12,000 jobs at risk. Firms like Simmons & Simmons, for example, might specifically advise on whether Wilko was labour law compliant before and during administration ( if, for example, Wilko executives cut corners by not providing advance notice to employees where there was an obligation to do so, etc). The firm might also advise on whether Wilko is under any legal obligation to pay compensatory employment-related rewards. [/QUOTE]
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