Collective Consultation

30 April, 2015
by: Cripps Pemberton Greenish

The European Court of Justice (ECJ) has given its judgment this morning in the USDAW v Woolworths case on collective consultation. Under UK law, an employer must inform and consult with employee representatives when they propose to make 20 or more employees redundant at one establishment. Failure to do so can lead to an award of 90 days’ pay being made to each affected employee (a protective award).

The question the Court had to consider was what the meaning of an ‘establishment’ is for multi-site employers. Does an employer need to engage in collective consultation when it plans to make 20 employees redundant across its sites or only where the number reaches 20 at one site?

The answer according to the ECJ is that there is no requirement to aggregate the number of redundancies at the employer’s different locations. ‘Establishment’ means an individual workplace, not all the employer’s sites. If an employer plans to make 45 employees redundant across three sites (with 15 at each site) there will be no requirement to collectively consult. If, on the other hand, an employer makes 30 employees redundant at one site, they will be required to collectively consult with the employees.

It is important to remember that employers have a separate obligation to consult individually with any employees they plan to make redundant.