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the meaning of one establishment

4 July 2013

In a redundancy situation the duty to consult with employee representatives is engaged where 20 or more redundancies are proposed at one establishment within a period of 90 days. But what does 'one establishment' mean?

The EAT has confirmed in the case of USDAW v Woolworths that a purposive approach should be taken in line with the EU directive and construed 'establishment' as meaning the business of each employer as a whole irrespective of the fact that it might be carried on over multiple sites. Woolworths, as a business, had over 20 employees and therefore all staff should have been consulted even in those stores with fewer than 20 employees.

The case will have huge ramifications particularly for those in the retail sector with multiple stores. When embarking on a redundancy exercise, consider whether there are over 20 employees in total at risk of redundancy and whether any other employees have been made redundant in the preceding 90 days.

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