The 'Woolworths' case of Usdaw v Ethel Austin Ltd (in administration) regarding the collective consultation requirements and the words 'at one establishment' has been referred to the CJEU by the Court of Appeal.

The referral allows the CJEU, should it so wish, to join the case with the NI industrial tribunal case of Lyttle v Bluebird, which was referred to the CJEU in April 2013 and deals with substantively the same issue - should the words 'at one establishment' effectively be ignored in domestic legislation, thereby requiring employers to consult with representatives wherever 20 or more employees are being made redundant, regardless of the location?

In relation to the Lyttle case the Court of Appeal noted that:

"...the employees do not have the benefit of legal representation in the CJEU on this important issue and in a case which will have consequences across a large swathe of economic activity in member states which have opted for the second model of implementation. We do not know how many have, but in any event the point affects very large numbers in the United Kingdom. The union supporting the employees in the present case also has pending cases relatin g to at least three other large retail chains."

Further, the Court of Appeal raised an issue about a question not included in the Lyttle reference - the "vertical direct effect" i.e. "... whether, in these proceedings, the Secretary of State could rely on the state's failure to implement the directive, if such a failure is established, to defeat the employees' putative claim against him in domestic law." 

Practical lessons from this decision

This important case could have a big impact on multi -site reorganisations and closures in industries such as retail where business decisions on closure often come down to economic performance of specific units and geographic areas.

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