The ECJ Advocate General has today issued an opinion on the meaning of 'establishment' for the purposes of deciding whether the obligation to collectively consult has been triggered in a redundancy situation.
He disagreed with the EAT's decision that 'establishment' should be interpreted as meaning the business as a whole, instead favouring a purposive approach and a return to the pre-Woolworths position. Accordingly, dependent on the circumstances, it is the number of redundancies at a single business unit such as a shop that triggers the obligation to collectively consult.
The Advocate General decided that the UK Government had correctly implemented the EU Collective Redundancies Directive and noted that the social protection aim of the Directive was to protect workers where large numbers of local redundancies were being made. This meant that the 'establishment' in question had to be the local employment unit to which employees were assigned to carry out their duties.
Multi-site businesses (and the Secretary of State) will feel initial relief at this opinion but any excitement will need to be curbed until the ECJ issues its decision, which normally follows around six months after the Advocate General's opinion. The ECJ usually (but does not always) follows the Advocate General's opinion. In the meantime, employers are stuck with the EAT's decision, which suggests that they have to carry out collective consultation – and will be liable for protective awards – if they propose to make 20 or more redundancies across their whole business within 90 days. Employers will no doubt seek to stay any proceedings pending the ECJ's decision.