Addleshaw Goddard

Court of Appeal decides that the collective redundancy provisions in TULRCA covered the closure of a US military base in UK

The obligation to consult about collective redundancies under section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) may apply even where they come about due to the strategic decisions of foreign governments, the Court of Appeal has held in USA v Nolan (No 2). The Court of Appeal rejected the US’s argument that there was an implied exemption to the consultation requirements in relation to the actions of a foreign sovereign state engaged in the exercise of public powers. A further hearing will be listed to consider the vexed question of whether the obligation to consult collectively about proposed redundancies involves engaging with the reasons for the dismissals (i.e. the strategic decision to close the base) or whether it only arises once the strategic/commercial decision has been taken (USA v Nolan (No.2)).

Following the decision of the US government to close a US Army base in Hythe, Hampshire, around 200 employees were given notice of dismissal, due to redundancy. Ms Nolan, an employee at the army base, brought a claim for a protective award under section 189 of TULRCA on the basis that there had been no consultation over the US government’s operational decision to close the base (as opposed to consulting over the consequential redundancies only, once the decision to close had been taken).

It would have been open to the US government to rely on the principle of state immunity and refuse to submit to the jurisdiction of the English tribunal system. However, it failed to raise the question of state immunity until after the liability hearing, by which time it had already submitted to the jurisdiction…

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