Businesses Await Decision On High Profile Woolworths Redundancy Case

Lawyers Say Decision Will Have Wider Impact On All Large Organisations

29.04.2015

David Shirt, Press Officer | 0161 838 3094

The European court of justice will hand down its judgment on Thursday (30 April) in the case of thousands of former Woolworths and Ethel Austin employees who missed out on millions of pounds in redundancy compensation due to the size of store they worked in.

The case focuses on former employees at Woolworths and Ethel Austin who lost their jobs in 2008 and 2010 respectively, but were not collectively consulted by the Administrators.
 
Unions acting for the affected staff brought claims in the Employment Tribunal for protective awards. However, over 3,000 staff who worked at smaller Woolworths stores and 1,200 former employees of Ethel Austin did not receive these awards at the initial Employment Tribunal in 2010, whilst former employees who worked in larger shops did.
 
This was because the Tribunal decided each individual shop counted as one ‘establishment’ and under UK law, these employees were excluded from the obligation to consult and so were not entitled to compensation.
 
The USDAW union successfully appealed to the Employment Appeal Tribunal (EAT) but following an intervention from the UK Government, the case was then heard last November by the Court of Appeal and referred straight to the Court of Justice of the European Union (CJEU).
 
The final CJEU decision will impact on future large scale redundancy processes and will have wider implications for workers who have recently been made redundant.
                                                                                        
In February this year, the Advocate General provided his guidance on the case ahead of the definitive ruling on Thursday.
 
The Advocate General, Nils Wahl, backed the UK Government and said that UK law and the interpretation of the European Collective Redundancy Directive are compatible.
 
If the CJEU followed these recommendations, it would result in less costly collective redundancy rules whereby companies do not have to automatically consult with staff in a particular establishment if they number fewer than 20.