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Do you need to count all your employees at all your sites for redundancy consultation?
You may know it as the 'Woolworths case', but it's formally called USDAW & anor v VW Realisation 1 Ltd and ord (phew… that's hardly 'catchy'!) and basically, it's caused lots of sleepless nights for business owners and HR & employment professionals.
WHY?
Well, the Employment Appeal Tribunal ruled a few years ago that a business with multiple sites (these are known as "establishments") had to count the employees from all sites together to determine if the business needed to comply with collective redundancy consultation requirements.
This meant that businesses had to stick to specific time periods when consulting with Trade Union or elected employee representatives before they could give notice to employees who were going to be dismissed for redundancy. If they didn't stick to the requirements, the business could be ordered to pay out a considerable amount of money for a 'protected award' as well as for unfair dismissal claims. It just felt like yet another hoop for businesses to jump through when there was already the pressure of dealing with a difficult workforce situation.
WELL, WE CAN ALL NOW BREATH A SIGH OF RELIEF…
The ECJ has confirmed that 'establishment', for the purpose of the collective redundancy consultation requirements mean the entity to which the worker is assigned. There is no requirement for dismissals at all establishments to be aggregated so you just need to enter into collective redundancy consultation at those establishments where it is proposed to dismiss 20 or more employees.
So, in the Woolworths case, when establishing headcount to see whether it needed to engage in collective consultation, Woolworths was right to count each store as a separate 'establishment'. This, in turn, meant that it did not need to engage in collective consultation with staff who worked in a store with a headcount of less than 20.
WHAT HAPPENS NEXT?
Well, the ECJ has formally referred the case back to the Court of Appeal in the UK, but the Court of Appeal's decision is now likely to be a formality and will just reverse the decision of the EAT that kicked it all off in the first place!
We've also had a further ECJ decision in the case you'll know as "the Bonmarche case" (or to give it's official name, Lyttle & Others v Bluebird UK Bidco 2 Ltd!) which follows the Woolworths case
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In or Out?