It’s believed the settlement runs into many hundreds of thousands of pounds and is one of the largest employment law settlements of its kind here.
Four of the staff are members of Nipsa, the public sector union, which fought a legal battle over what it said was the unfair dismissal of its members.
Ilex Urban Regeneration Company was set up in 2003 by the Department for Social Development (now part of the Department for Communities) and the Office of the First and Deputy First Ministers (now The Executive Office) to promote the physical, economic and social regeneration of Derry.
It had specific responsibility for the development of Ebrington site, a former military barracks, on the east bank of the Foyle. It was also involved in developing the NI Science Park, and involved in the City of Culture bid.
The development body went through five chief executives in 13 years. One chief executive – former top civil servant Aideen McGinley – had to apologise before the Public Accounts Committee at Stormont after auditors confirmed Ilex had overspent £400,000 without approval from the government departments which set it up.
Ilex finally closed its doors in early 2016.
Nipsa general secretary Alison Millar said: “When the staff of Ilex were advised in October 2015 that the organisation was to close by the end of the financial year, and they would lose their jobs, it was a huge shock to them.
“This came following a review of Ilex, during which its board had been assured that there would be no surprises when the review report was published.
“At the time, Nipsa argued vehemently that, as some of the work of Ilex was being transferred to The Executive Office and the Strategic Investment Board, its staff should also transfer under the Transfer of Undertakings Protection of Employees Regulations (TUPE).
“This was rejected out of hand, the staff lost their jobs and Nipsa was forced into lodging Industrial Tribunal proceedings for our members.
“Without membership of the union, these individuals would not have been in a position to take a legal challenge themselves, so on their behalf, we are very pleased that Nipsa and our brave members have been totally vindicated.”
Ms Millar said the settlement showed the union’s case was right.
“While no financial compensation can replace someone’s job and the trauma these unfair dismissals caused, the substantial six figure settlement reached in these cases shows that The Executive Office and the Strategic Investment Board were wrong in dismissing these individuals.
“As a result, this is money which will now come out of the public purse to compensate the individuals concerned.”
John McShane of solicitors McCartan Turkington Breen, who represented the trade union, said it sent a clear message to employers.
“This is a stark warning to employers of any size or sector that they should obtain legal advice in relation to their responsibilities to employees, as this case clearly shows that the financial implications of not following the legal protections of TUPE can be very serious indeed.”