Collective redundancy
The EC Directive relating to collective dismissals (Council Directive 75/129 of 1975 as amended and consolidated in Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective redundancies) provides the following definition of collective redundancies: ‘dismissals effected by an employer for one or more reasons not related to the individual workers concerned...’. The context for the introduction of the Collective Dismissals Directive was the economic difficulties following the oil crisis of 1973, which led to many closures and restructuring of enterprises. Hence, the Directive has come to be perceived as limited to dismissals of a particular kind: economic, redundancy or technical dismissals , reflected in various national implementing provisions. However, it is the underlying principle of the Collective Dismissals Directive that is significant: that dismissals are a collective issue, to be dealt with through collective information and consultation rights. Article 2(1) provides: ‘Where an employer is contemplating collective redundancies, he shall begin consultations with the worker representatives in good time with a view to reaching an agreement.’ Specifically, the employer is required to consider alternatives to dismissal. The consultation required ‘shall, at least, cover ways and means of avoiding collective redundancies or reducing the number of workers affected, and of mitigating the consequences.’ Amendments in 1992 (by Directive 92/56) added a reference to ‘recourse to accompanying social measures aimed, inter alia, at aid for redeploying or retraining workers made redundant.’ Another new requirement inserted by the 1992 amendments was that employers notify worker representatives of: ‘(v) the criteria proposed for the selection of the workers to be made redundant in so far as national legislation and/or practice confers the power therefore upon the employer; (vi) the method for calculating any redundancy payments other than those arising out of national legislation and/or practice’.
The 1992 Amendment (Article 2(4)) also made clear that the obligations ‘shall apply ,irrespective of whether the decision regarding collective redundancies is being taken by the employer or by an undertaking controlling the employer’, and that ‘in considering alleged breaches of the information, consultation and notification requirements laid down by this Directive, account shall not be taken of any defence on the part of the employer on the grounds that the necessary information has not been provided to the employer by the undertaking which took the decision leading to collective redundancies’. This has significant implications for transnational enterprises in particular, since if the reason the (national-level) employer produces for not having consulted is their own lack of information, this defence will not be taken into account.
To be covered by the Directive, the number of such dismissals has to reach thresholds stipulated in Article 1(1)(a) of the Directive: ‘(i) either, over a period of 30 days: at least 10 in establishments normally employing more than 20 and less than 100 workers; at least 10% of the number of workers in establishments normally employing at least 100 but less than 300 workers; at least 30 in establishments normally employing 300 workers or more; (ii) or, over a period of 90 days, at least 20, whatever the number of workers normally employed in the establishments in question’. Terminations of individual contracts can also be included in the relevant numbers (provided that there are at least five) when they take place contemporaneously with dismissals.
See also: dismissals; flexicurity; restructuring; transnational enterprise.