Collective redundancies - Consultation requirement update

03 March 2014

Elizabeth Lang, Penny Hunt

The long-running case of Nolan v USA has been referred back to the Court of Appeal (CA) from the Court of Justice of the EU (CJEU), but still no decision has been made on the real question in issue.

The CJEU held that, as the case concerned the closure of a US military base in the UK, the relevant European Directive did not apply.

However the CA decided that this does not mean that the relevant UK legislation does not apply.

Therefore a further hearing must take place at which the CA should decide on the timing of an employer’s statutory obligation to consult with the workforce about collective redundancies.

We need to know whether the obligation arises:

  1. When the employer is proposing, but has not yet made a strategic business or operational decision to close a workplace that will foreseeably or inevitably lead to redundancies; or
  2. Only when the decision to close the workplace has already been made and redundancies are being proposed.

Previous decisions on this important question are contradictory and a clear lead from the CA would be welcomed.

This article is part of the UK Employment Law Update for March 2014