RSS Feed

Legal Updates

More Articles: Latest Popular Archives

Consultation obligation question referred to ECJ

Consultation obligation question referred to ECJ

In The United States Of America v Nolan, the Court of Appeal decides to ask the EJC whether the collective consultation obligation in redundancy arises: (i) when the employer is proposing, but has not yet made, a strategic business or operational decision that will foreseeably or inevitably lead to collective redundancies; or (ii) only when that decision has actually been made and consequential redundancies are actually being proposed?

Mrs Nolan complained that the USA had failed to consult with representatives of the civilian workforce in accordance with its obligations under S.188 of TULRCA 1992 and in particular, that it had not so consulted before, and about, taking the operational decision to close a Base in Hampshire. A tribunal and the EAT upheld Mrs Nolan’s claim. The USA appealed. It argued that the ECJ’s decision in Akavan Erityisalojen Keskusliitto Alek RY and others v. Fujitsu Siemens Computers meant that the consultation obligation is not triggered by a ‘proposed’ business decision and that the consultation obligation only arises at the later stage when the business decision has been made and the intention to make the employees redundant has been formed.

The Court of Appeal did not find the interpretation of the ECJ’s decision straightforward. Does the ECJ explain whether the consultation obligation arises: (i) when the employer is proposing, but has not yet made, a strategic business or operational decision that will foreseeably or inevitably lead to collective redundancies; or (ii) only when that decision has actually been made and he is then proposing consequential redundancies? Some of the ECJ’s observations favour (i) but others favour (ii). The matter would therefore be referred to the ECJ as to the point at which, under the Directive, the consultation obligation arises.

November 2010

Receive more HR related news and content with our monthly Enewsletter (Ebrief)