What's the future for collective redundancies?

What's the future for collective redundancies?

What impact will the Advocate General's (AG's) Opinion on collective redundancy consultation obligations have on employers? David Reade QC of Littleton Chambers examines the Opinion, which he says will give cautious optimism to employers.

Lyttle and others v Bluebird UK Bidco 2 Ltd: C-182/13; Cañas v Nexea Gestión Documental SA, Fondo de Garantía Salarial: C-392/13; USDAW and another v WW Realisation 1 Ltd, in liquidation and others: C-80/14

Why is the meaning of 'establishment' so important to the claimants in these cases?

The claimants in all the UK cases worked in shops with fewer than 20 employees, or they were members of the Union of Shop, Distributive and Allied Workers (USDAW) that represented employees that did. If establishment governs the position and the shop is the establishment there is no collective consultation obligation in respect of a shop with fewer than 20 employees and no possibility of a protective award. If the correct test is whether the whole employer is proposing more than 20 redundancies, regardless of the establishment at which people worked, then everyone would get the protective award in the event of a breach.

What are the competing interpretations of 'establishment'?

The primary argument of the claimants (USDAW appeared at the hearing) was that the establishment test should not apply at all to the question of collective redundancy under the UK model because the UK had elected to use a model under the Collective Redundancies Directive 98/59/EC that did not use the establishment test.

A secondary argument involved suggesting that establishment should be given a different meaning in one part of the Directive to another.

Why have the questions referred to the European Court of Justice (ECJ) drawn such significant interest from the employment law and business community, as well as the UK government?

If the claimants' argument is right, then one looks at the entire employer and asks whether it was proposing

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