Iqbal looks at the recent decision in the Woolworths case affecting collective consultation on

redundancies.
THE ECJ handed down judgement yesterday on the meaning of establishment in the EU
Collective Redundancies Directive. It held, overruling USDAW v Ethel Austin Limited
(Woolworths case) that the duty to consult over collective redundancies is triggered where
employers propose to make 20 or more redundancies within 90 days, per establishment (or
local employment unit) not overall in the business.
In 2013 I sent out an e-shot and gave a seminar on the significance of the decision in
USDAW v Ethel Austin Ltd [2013] UKEAT/0547/12/KN, offering my prediction that the EUs
employment friendly ECJ would support its conclusion that s. 188, Trade Union and Labour
Relations (Consolidation) Act 1992 failed implement the EU Collective Redundancies
Directive (No.98/59) properly.
The EAT had held that the words at one establishment in s. 188 did not originate from the
Directive and were not debated in Parliament.

Applying Ghaidan v Godin Mendoza [2004] 2 AC 557, the EAT held that it was obliged to
go as far as possible to purposively construct s. 188 and comply with the Directive.
Consequently, the EAT deleted the words at one establishment from section 188 as a
matter of construction. This, in one fell swoop, extended the right of collective consultation,
or in its absence a protective award, to significantly more employees than previously as the
question became whether there were 20 employees or more in aggregate being made
redundant across all sites, not in one site.
The Advocate Generals opinion
On the Court of Appeals referral to the ECJ, there was some glimmer of hope when the
Advocate Generals opinion on 5 February 2015 concluded that establishment must be
construed in the same way throughout the Directive and meant the local employment unit to
which the redundant employees are assigned to carry out their duties. Further, the local
employment unit was a matter of fact to be determined by national courts.
His view was that the UK had correctly implemented the Directive. While it was open to
national governments to make collective redundancy obligation apply where the total
redundancies in aggregate are 20 or more, this was going beyond the Directive. At this point
I started selling off shares in my original prediction!
ECJ Ruling
Yesterday, upsetting the UKIP narrative on Europes overregulation, the ECJ held that where
a business comprises several undertakings, establishment refers to that entity where the
redundant workers are assigned to carry out their dutiesthat is, their local place of work.
This reverses removes the significant burden placed on employers by the original ruling,
which extended collective consultation dramatically.
Whether the stores in the Woolworths case are one establishment has been referred back
to the Court of Appeal to determine, it being a matter for the national courts to consider.
Practice Point
While the Court of Appeal is yet to rule on the facts of the Woolworths case, large employers
considering making redundancies across a number of sites are likely to be safe treating each

site separately for the purposes of considering their collective redundancy obligations
without needing to aggregate the total employees.
Those employers currently undertaking collective consultation on the law as it previously
stood should seek specific advice.