The ECJ has 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.
In Practice
Employment Partner Kate Fretten says, “This decision is a blow to thousands of ex-Woolworths employees, who will now not receive any pay-out for failure to be consulted with by Woolworths. The decision, while reversing the EAT decision, is not too much of a surprise as the Advocate General, who gives an opinion a few months before the actual decision, and with which the court nearly always agrees, came to the same conclusion.”
At Frettens, all of our solicitors offer a free initial meeting or chat on the phone to answer your questions. If this article raises issues for you or your business, please call us on 01202 499255 and Kate or Paul will be happy to discuss it with you.
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