"Woolworths Case" – European Advocate General Gives His Opinion and it is Encouraging News for UK Employers

    View Author February 2015
    The Advocate General has today given his Opinion in the “Woolworths case” (and two other cases) regarding the scope of an “establishment” for the purposes of determining when the duty to consult appropriate representatives is triggered under the Collective Redundancies Directive (the Directive).

    The good news for UK employers is that the Advocate General has effectively confirmed (in his opinion) that the original wording of s.188(1) of the Trade Union and Labour Relations (Consolidation) Act 1992, which includes the words “at one establishment” was a legitimate position for the UK Government to have adopted when it implemented the Directive.
    The referral from the UK followed the Employment Appeal Tribunal’s (EAT) finding in the “Woolworths case” that the UK Government had failed to implement the Directive properly. The EAT held in that case that the words “at one establishment” must be deleted from the offending part of s.188(1) of TULR(C)A in order to bring it in line with the Directive. The EAT’s decision meant that UK employers were obliged to aggregate all proposed redundancies across their various business locations across the UK for the purposes of determining whether the relevant threshold of 20 (or 100) proposed redundancies would be met in any rolling 90-day period.

    According to the Advocate General, the limb of the Directive relied upon by the UK Government when it implemented TULR(C)A did not require employers to consult collectively whenever they proposed to dismiss as redundant 20 or more employees situated anywhere across their UK business within a 90-day period. It is legitimate for employers to only consult collectively when they are proposing to dismiss 20 or more employees at one “establishment” within this period. In the Advocate General’s view, “establishment” for these purposes means: “the unit to which the workers made redundant are assigned to carry out their duties, which it is for the national court to determine”.

    The Advocate General accepted that if his Opinion is correct this would mean that some workers dismissed in the course of the same restructuring exercise would not be protected (one of the key submissions in the Woolworths case). In his view such a possibility was not contrary to the Directive, as the aim of the Directive was not to provide full protection for all employees but to provide a certain minimum level of protection in certain scenarios (as clearly evidenced by the fact that the duty is only triggered when 20 or more dismissals are proposed in a 90-day period).

    The Advocate General’s Opinion is only his view, and it is not binding law nor is it binding on the European Union’s Court of Justice (ECJ). The ECJ must still consider the same legal points. However, the ECJ does usually (but not always) follow the Advocate General’s Opinion, so there is scope for UK employers to be optimistic about the prospects of a favourable ECJ decision.

    What does this mean for UK employers? Assuming the ECJ does concur with the Advocate General’s Opinion, we should be back to where we were prior to the Woolworths case, with the UK Employment Tribunals required to undertake a fact-finding exercise as to whether one or more locations should be counted as “one establishment” for the purposes of the totting-up exercise under TULR(C)A. In the meantime we remain in a state of uncertainty, with a binding EAT decision in the Woolworths case that has now been undermined (but not legally overturned) by the Advocate General’s Opinion.