The case arose from a dispute between the US government and a civilian employee at a US military base in the United Kingdom, and concerned the former's obligation to consult with 106 staff before carrying out redundancies.

The Court of Appeal in England and Wales referred the following question to the Court of Judicature of the EU, which concerns the interpretation of Article 2 of Council Directive 98/59/EC on the approximation of the laws of Member States relating to collective redundancies. "Does the employer's obligation to consult about collective redundancies, pursuant to Directive 98/59, arise

(i) when the employer is proposing, but has not yet made, a strategic business or operational decision that will foreseeably or inevitably lead to collective redundancies; or

(ii) only when that decision has actually been made and he is then proposing consequential redundancies?"

As Article 1(2)(b) of Directive 98/59 excludes application of the Directive to workers employed by public administrative bodies or by establishments governed by public law or, in Member States where that concept is unknown, by equivalent bodies, the CJEU held that it did not have jurisdiction to answer the question. The Court held that activities which fall within the exercise of public powers, such as national defence, are in principle excluded from classification as economic activity. The wording of Directive 98/59 does not distinguish between Member States and non-Member States.

As the Court of Judicature ruled that it does not have jurisdiction to hear the question, the Court of Appeal must now resolve the matter.

Read the full opinion of the Advocate General MENGOZZI delivered on 22 March 2012.