Woolworths redundancy appeal referred to ECJ

By Alan Chalmers

The Court of Appeal has decided to make a reference to the European Court of Justice (ECJ) in the controversial Woolworths/Ethel Austin collective redundancy litigation.

In USDAW v Ethel Austin (in administration), the Ethel Austin and Woolworths chains of shops had gone into administration resulting in their employees being made redundant. The employees who were members of a trade union claimed protective awards for failure to consult collectively under section 188 of the Trade Union and Labour Relations (Consolidation) Act (TULRCA), which provides that an employer is required to consult with appropriate representatives when proposing to dismiss as redundant 20 or more employees at one establishment within a 90-day period. At the employment tribunal, only those employees who were employed at premises where 20 people or more were employed succeeded in claiming protective awards. Those who worked at stores of fewer than 20 people failed in their claims. The union appealed to the Employment Appeal Tribunal (EAT). The issue before the EAT was whether section 188 was to be interpreted so as to omit the words ‘at one establishment’ in order to give effect to the core objective of the EU directive on collective redundancies, allowing protective awards to be made to all employees whose employer dismissed 20 employees as redundant within 90 days. The EAT held that those words should be deleted. The consequence of this was that the secretary of state (and ultimately the taxpayer) was liable for the protective awards.

Not long before the EAT handed down judgment in Ethel Austin, a tribunal in Northern Ireland referred a similar case, Lyttle v Bluebird UK Bidco Ltd, to the ECJ. That case concerned redundancies arising out of the administration of the Bon Marche chain…

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