Collective redundancies: when is the obligation to consult triggered?

12 November 2010

The question of when an employer’s obligation to collectively consult arises has been referred to the European Court of Justice. Specifically, the issue is whether the obligation to consult arises before or after a decision is taken that will result in collective redundancies?

USA v Nolan can be summarised as follows:

  • In March 2006, the Secretary of the US Army made a decision to close an army base;
  • On 24 April workers were informed of the closure;
  • Consultation began on the 5 th June; and
  • ET found the USA didn’t carry out any significant consultation and made a protective award (upheld by the EAT).

According to S188 TURLA 1992, consultation is required when an employer is “ proposing ” to dismiss an employee. However under the Directive consultation is required when an employer is “ contemplating ” redundancies.

Hopefully the issue will now be resolved.