ECJ judgement on Collective Consultation

30 April 2015

The European Court of Justice has handed down a judgement on the cases Union of Shop, Distributive and Allied Workers (USDAW) and B. Wilson v WW Realisation 1 Ltd (in liquidation), Ethel Austin Ltd and Secretary of State for Business, Innovation and Skills that takes us one step closer to reversing the EAT decision requiring employers to collectively consult whenever an employer proposes 20 or more redundancy dismissals in 90 days or less across its business, regardless of how many redundancies are proposed at any single establishment

This judgement follows the announcement in February from the Advocate General who released an Opinion saying that the EAT’s decision in Woolworths was wrong.

With thanks to Daniel Barnett’s employment law bulletin, for the following alert of the latest summary from the Court of Justice of the European Union.

“ECJ: Collective Consultation - Woolworths Decision

The European Court of Justice has handed down its judgment in the Woolworths and Ethel Austin cases. The full text is not online yet, but the court's official summary is.

The ECJ held that 'establishment', in the collective redundancy legislation, refers to an individual workplace (or, more accurately, the entity to which the workers made redundant are assigned to carry out their duties), not to the employer as a whole.

So when establishing headcount to see whether an employer needs to engage in collective consultation (required when contemplating 20+ redundancies in a period of 90 days), Woolworths was right to count each store as a separate 'establishment'. This, in turn, meant that it did not need to engage in collective consultation with staff who worked in a store with a headcount of less than 20.

The ECJ has formally referred the case back to the Court of Appeal, but the Court of Appeal's decision is now likely to be a formality - i.e. reversing the decision of the EAT in the summer of 2013 which set the employment law world afire.”

 

This brings us one step closer to returning to a pre-Woolworths position of consultation obligations being triggered on an establishment by establishment basis which would significantly lighten the burden on organisations who would no longer have to try to keep track of all redundancies proposed across the whole business.

Previous coverage on this subject is available at news.