It's a trap!

Employment Law Newsflash - April 2015


In this issue ...

Woolworths case on collective redundancy and meaning of 'establishment'

Before the now infamous USDAW v Woolworths case an employer was required to consult 'appropriate representatives' of employees if, within a period of 90 days or less, it was proposing to dismiss as redundant 20 or more employees at one establishment.

In Woolworths the EAT decided that the legislation, to comply with European law, should be read as if the words 'at one establishment' were omitted. Since then an employer has been required to collectively consult when it proposes 20 or more redundancies within 90 days regardless of the number at any particular location. This has proved difficult and unduly burdensome for multi-site businesses.

However things are about to change and should revert to the original position.

The European Court of Justice has handed down its judgment in Woolworths and Ethel Austin.

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

So when considering whether there is a requirement to collectively consult (when contemplating 20 or more redundancies in a period of 90 days), Woolworths was right to count each store as a separate 'establishment'. This meant that it did not need to collectively consult employees who worked in a store with a headcount of fewer than 20.

The ECJ has referred the case back to the Court of Appeal, but its decision is now likely to be a formality and should reverse the decision of the EAT.

This decision is, as we said in our February 2015 edition, unsurprising and as expected.

We will keep you posted…


If you would like to discuss this or any other issue facing your organisation please speak to your usual contact at Collinson Grant or Jo Hale on 0161 703 5600

Although care has been taken in the preparation of this Newsletter, Collinson Grant cannot accept responsibility for errors, omissions or advice given. Readers should note that only Acts of Parliament and Statutory Instruments have the force of law and only the courts can authoritatively interpret the law.