Duty to consult
Junk v Kuhnel, European Court of Justice January 2005
In this important decision, the European Court of Justice (ECJ) has addressed the issue of an employer’s duty to inform and consult with employees before undertaking collective redundancies.
Junk worked as a care assistant. After her employer became insolvent, she was given notice by the liquidator on 27 June 2002 that he intended to terminate the contracts of employment and to carry out a collective redundancy with termination effective from 30 September 2002.
Relying on a particular interpretation of the Collective Redundancies Directive, she argued before the Labour Court of Germany that her redundancy had been ineffective.
The court stayed the proceedings and referred two questions to the ECJ for preliminary ruling. First, should ‘redundancy’ under the directive be interpreted as meaning the notice of dismissal, or did it mean the termination of the employment relationship upon expiry of the period of notice?
Second, if the answer to the first question was that redundancy meant the notice of dismissal, did the directive require that the consultation procedure under Article 2 of the directive and the notification procedure under Articles 3 and 4 were to be concluded before the notices of dismissal were announced?
The directive states that these obligations should be complied with before the redundancies come into effect, but leaves the term ‘redundancy’ undefined.
The ECJ ruled that redundancy for these purposes means when the notice of potential redundancy is announced, and not when the actual contract of employment is terminated. It rejected the UK government’s submission that redundancy must refer to the point at which employment relations come to an end, rather than when notice of potential redundancy is given. It said that the spirit of the legislation would be undermined if it was possible to give notice of termination prior to the conclusion of any consultation process.