Redundancies consultation: UK and European law compared

In the wake of BMW’s decision to sell Rover, union leaders have complained that British employees have less legal protection than their European counterparts when mass redundancies become likely.

The complaint appears to be aimed at the UK’s implementation of the European Union’s Collective Redundancies directives. It is certainly true that before the Government amended UK law in 1993 and 1995 the directives had not been implemented fully and that UK employees had less protection from, and say about, collective redundancies. But does the complaint still hold true?

The present position is that both UK and European law require an employer to consult with employee representatives – a recognised trade union or, if no unions are recognised, elected employee representatives – about proposed redundancies. Since the 1993 amendments, UK law provides that employers must enter consultation with a view to reaching agreement and that the aim of consultation is to avoid redundancies, reduce their number and mitigate the impact of the redundancies. The duty arises where 20 or more staff are to be made redundant at the same establishment within a period of 90 days.

One key difference remains. UK law provides that the consultative process must begin when an employer “proposes” to make redundancies, where the relevant European directive provides that it will take place when an employer is “contemplating” redundancies. The literal meaning of the word proposing suggests the employer has reached a later stage in the planning process than if the employer is merely contemplating.

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This difference could be significant. Involvement “at an early stage” might mean the workers’ representatives can participate in the planning of the redundancy programme. On the face of it, UK law appears to provide that consultation need only begin once a decision has been made that redundancies are necessary , but there are legal arguments – not yet tested by the courts – that it must begin earlier.