The central issue in this case was whether the obligation to consult collectively arises when an employer proposes to make a decision that will inevitably lead to redundancies, or only when that strategic decision has already been made and redundancies are proposed as a consequence. The ECJ was asked to clarify when collective redundancy consultation is triggered and what an employer should consult about. In March 2012, the Advocate-General gave his opinion that the obligation to consult arises when a strategic or commercial decision is taken that compels an employer to contemplate or plan collective redundancies. This opinion also seemed to disapprove of the EAT decision in UK Coal Mining Ltd v National Union of Mineworkers which held that consultation in respect of a factory closure should include discussion of the business reasons behind the redundancies.
However, the ECJ has now held that it does not have jurisdiction to give a ruling in USA v Nolan because civilian employees working on a military base fall within an exclusion in the European Collective Redundancies Directive for employees of public administrative bodies. The case will therefore now have to go back to the Court of Appeal.
The ECJ’s refusal to provide clarification on these issues is all the more frustrating as we are left with differing interpretations of the legislation at national and European level. Although it remains safer to consult collectively at an earlier stage, this is often not practical commercially or in terms of employee relations.