The Woolworths Case - Employers can pick and don’t have to mix
Woolworths, Collective Redundancies and 'Establishment'
The eagerly awaited judgment in the Woolworths and Ethel Austin cases has been handed down today by the Court of Justice of the European Union (ECJ).
The ECJ has sought to clarify the term 'establishment' in connection with collective redundancies.
In today's judgment the court finds that where an undertaking comprises several entities, the term 'establishment' in the directive on collective redundancies must be interpreted as referring to the entity to which the workers made redundant are assigned to carry out their duties. Thus, the term does not refer to the employer as a whole.
Woolworths – right all along
This will be most welcome news for multi-site employers. The ECJ has confirmed that Woolworths was right to count each store as a separate 'establishment'.
The Court has confirmed that in practical terms going forward, employers will not need to engage in collective consultation with employees across the whole organisation, but rather they must engage with the affected entity. Collective consultation obligations will be triggered in circumstances where the employer is contemplating 20+ redundancies in a period of 90 days.
The ECJ has formally referred the case back to the Court of Appeal in Great Britain, given that the Court of Justice does not decide the dispute itself. This will likely be a matter of formality and, it is hoped, will bring about finality to this saga.
In addition to Woolworths and Ethel Austin, the Belfast Industrial Tribunal has also had cause to consider the issue in the case of Lyttle and Ors v Bluebird UK Bidco 2 Ltd. It too sought clarification from the ECJ on the definition of 'establishment'. In light of the ECJ judgment in Woolworths and Ethel Austin we anticipate that a similar outcome will be confirmed.
For further information please contact a member of our Employment team, A&L Goodbody Northern Ireland.
Date published: 30 April 2015