Collective redundancy consultation – Advocate General’s ppinion

Posted: 13th April 2012

In United States of America v Nolan, the Court of Appeal sought guidance from the European Court of Justice (ECJ) as to the point at which the obligation to consult arises under Directive 98/59/EC – the "Collective Redundancies Directive".
The Employment Tribunal initially and then the Employment Appeal Tribunal relied on the decision in UK Coal Mining Ltd. v National Union of Mineworkers that where closure and dismissals are inextricably linked, the duty to consult over the reasons for the closure arises.
The USA appealed on the ground that the more recent judgment of the ECJ in a Swedish case (Akavan Erityisalojen Keskusliitto Alek RY and others v Fujitsu Siemens Computers) is authority for the proposition that the consultation obligation is not triggered by a proposed business decision to close down a workplace but only arises at the later stage when the decision has been made and the intention to make the employees redundant has been formed.
Advocate General Mengozzi has now given his opinion on the matter. In his view, the Directive must be interpreted as meaning that an employer’s obligation to consult with workers’ representatives arises ‘when a strategic or commercial decision which compels him to contemplate or to plan for collective redundancies is made by a body or entity which controls the employer’.
It is for the national courts or tribunals to identify, based on the facts of the case, whether such a decision has been made and the date on which it was reached, and thus to identify when the obligation to consult with employees is triggered.
The Advocate General’s opinion is not binding on the ECJ but it is followed in the majority of cases. The Court's decision will follow.