Government to appeal in Woolworths case

Posted: 24th July 2013

WoolworthsHaving declined to attend, or comment on, the Employment Tribunal proceedings in USDAW v WW Realisation 1 Limited, as he had ‘nothing to usefully contribute about the consultation process between the parties’, the Secretary of State for Business, Innovation and Skills has now applied for leave to appeal against the landmark decision of the Employment Appeal Tribunal (EAT) that the words ‘at one establishment’ should be deleted from Section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) in order to give effect to EU Council Directive 98/59EC, which it is intended to implement.

The issue arose following the collapse of retail chain Woolworths, which went into administration in 2008 with the loss of nearly 30,000 jobs. The ET had treated each store as if it were a separate establishment. It therefore awarded employees who had worked at locations with 20 or more employees a protective award of 60 days’ pay for Woolworths’ failure to consult over the proposed redundancies but those who had worked at locations with fewer than 20 employees were denied an award. This approach was rejected on appeal, however. The EAT interpreted the Directive as imposing no site-based restriction and ruled that the claimants were entitled to a protective award.

If it stands, this decision will make a significant change to the collective consultation obligations of employers as it will be necessary to consult when 20 or more employees are to be dismissed as redundant, within a 90-day period, from the business as a whole.