Collective consultation requirements extended

You may recall that we sent out a hot news on 5 June 2013 advising that we had seen reports that the EAT had made a decision on a case involving the requirement for collective consultation which could have significant implications for employers in redundancy situations. The case is commonly known as USDAW v Woolworths (although if you look at the full decision you will see the name of the case is more complicated than this!).

The judgment in this case has now been published and we can report that the EAT decided that the UK is not compliant with European law with regard to the interpretation of 'establishment'. The EAT found that because Woolworths proposed to dismiss more than 20 employees within a 90 day period, they should have consulted with all affected employees, regardless of the size of the store because they should have treated the whole organisation as the 'establishment'.

This is a significant departure from the current interpretation of collective consultation law in the UK and will have serious practical consequences for multi-site employers. The decision means that s188 of the Trade Union and Labour Relations (Consolidation) Act 1992 should now be read as imposing collective consultation requirements whenever an employer proposes to dismiss as redundant more than 20 employees in a 90 day period.

Because Woolworths were in administration the cases were brought against the Secretary of State, who did not participate in the EAT hearing. Whether or not the decision will be appealed won't be known until around the end of July, but we will keep you advised of any further developments.

To read the full decision (case numbers ) click here.