Easyjet Plc v Easyjet European Works Council
| Jurisdiction | England & Wales |
| Judge | Lord Justice William Davis,Lord Justice Coulson,Lord Justice Bean |
| Judgment Date | 30 June 2023 |
| Neutral Citation | [2023] EWCA Civ 756 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2022-002486 |
and
[2023] EWCA Civ 756
Lord Justice Bean
Lord Justice Coulson
and
Lord Justice William Davis
Case No: CA-2022-002486
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
His Honour Judge Tayler
EA-2021-000760-LA
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Daniel Stilitz KC and Ms Sophie Belgrove (instructed by Lewis Silkin LLP) for the Appellant
Mr Fergus McCombie (instructed by EWC Legal Advisers) for the Respondent
Hearing date: 23 June 2023
Approved Judgment
This judgment was handed down remotely at 10.30am on 30 June 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
The issue in this appeal is whether the easyJet European Works Council (“the EWC”) remained in existence after the UK's departure from the European Union. The EWC was established pursuant to the Transnational Information and Consultation of Employees Regulations (“TICER”) 1999. Those Regulations were amended by the Employment Rights (Amendment) (EU Exit) Regulations 2019 (the 2019 Regulations. easyJet (“the company”), the appellant in these proceedings, argues that the amended regulations meant that the EWC ceased to exist as from 31 December 2020 i.e. the completion day of the UK's withdrawal from the EU.
TICER implemented EU Directives 94/45/EC and 97/74/EC. These Directives were subsequently replaced by EU Directive 2009/38/EC (the Directive). European Works Councils (EWC's) were to be established by any substantial undertaking operating within the EU. They were to provide information to and to engage in consultation with employees' representatives on transnational issues. The company established the EWC at some point following TICER. It is a well-known airline which operates across Europe. It employs some thousands of people both in the UK and elsewhere in Europe.
In May 2020 the company announced plans to reduce staff numbers by up to 30%. It stated that an employee consultation process would begin “in the coming days”. Staff reductions were planned in at least two countries within the European Economic Area. On 30 June 2020 the company began consulting with trade unions in relation to the proposed redundancies in the UK. Between June and August 2020 the company and the EWC communicated about the process of and the timescale for consultation with the EWC. Between September and December 2020 the communication was largely one-way, namely the EWC seeking further information needed to enable a proper consultation to occur. On 30 November 2020 the company e-mailed the EWC saying that further information was “about to be provided”.
In the event of a dispute about the operation of the information and consultation process of a European Works Council, a complaint can be made to the Central Arbitration Committee (“the CAC”). In this case the EWC submitted a complaint on 15 March 2021. The company's response was to challenge the jurisdiction of the CAC. They said that the provisions of TICER on which the EWC relied no longer had any application due to the amendment of TICER consequent upon the UK's withdrawal from the EU. The CAC considered this as a preliminary issue. It determined that it did have jurisdiction. It concluded that the EWC continued to exist and was able to make the complaint pursuant to TICER.
The company appealed to the Employment Appeal Tribunal. The appeal was heard by HHJ James Tayler. In a judgment handed down on 4 November 2022 Judge Tayler dismissed the company's appeal. He concluded that a proper construction of TICER as amended did not mean that the amendments made by reference to the UK's withdrawal from the EU had led to the EWC ceasing to exist. He reached that conclusion by reference to the natural and ordinary meaning of the words of the relevant part of TICER as amended, by reference to other provisions within the amended regulations (in particular transitional provisions) and by reference to the Explanatory Memorandum to the 2019 Regulations. The company now appeals against the decision of Judge Tayler.
In strict terms all that fell to be decided by the CAC was whether the EWC retained the power to make an application pursuant to TICER in relation to matters which occurred prior to exit day. The CAC implicitly concluded that the EWC continued to exist after exit day. Judge Tayler was explicit in his conclusion that TICER as amended would continue to apply to existing EWCs. I shall approach the issue on the same broad basis.
The critical provisions of TICER as amended are regulations 4 and 5. The parties to the appeal helpfully provided a version of these provisions showing the amendments made by the 2019 Regulations. They are as follows:
4 Circumstances in which provisions of these Regulations apply
(1) Subject to paragraph (2) the provisions of regulations 7 17 to 41 and of regulation 46 shall apply in relation to a Community-scale undertaking or Community-scale group of undertakings only where, in accordance with regulation 5, the central management is situated in the United Kingdom.
(2) The following regulations shall apply in relation to a Community-scale undertaking or Community-scale group of undertakings whether or not the central management is situated in the United Kingdom—
(a) regulations 7 and 8(1), (2) and (4) (provision of information on employee numbers);…
(b) regulations 13 to 15 (UK members of the special negotiating body);…
(c) regulation 18 to the extent it applies paragraphs 3 to 5 of the Schedule (UK members of the European Works Council);
(d) regulations 23(1) to (5) (breach of statutory duty);
(e) regulations 25 to 33 (protections for members of a European Works Council, etc);
(f) regulations 34 to 39 (enforcement bodies) to the extent they relate to applications made or complaints presented under any of the other regulations referred to in this paragraph;
(g) regulations 40 and 41 (restrictions on contracting out).
5 The central management
(1) The central management shall be responsible for creating the conditions and means necessary for the setting up of a European Works Council or an information and consultation procedure in a Community-scale undertaking or Community-scale group of undertakings. This regulation applies where—
(a) the central management is situated in the United Kingdom;…
(b) the central management is not situated in a Member State Relevant State and the representative agent of the central management (to be designated if necessary) is situated in the United Kingdom; or
(c) neither the central management nor the representative agent (whether or not as a result of being designated) is situated in a Member State Relevant State and –
(i) in the case of a Community-scale undertaking, there are employed in an establishment, which is situated in the United Kingdom, more employees than are employed in any other establishment which is situated in a Member State Relevant State or
(ii) in the case of a Community-scale group of undertakings, there are employed in a group under-taking, which is situated in the United Kingdom, more employees than are employed in any other group undertaking which is situated in a Member State Relevant State, and the central management initiates, or by virtue of regulation 9(1) is required to initiate, negotiations for a European Works Council or information and consultation procedure.
(2) Where the circumstances described in paragraph (1)(b) or (1)(c) apply this regulation applies, the central management shall be treated, for the purposes of these Regulations, as being situated in the United Kingdom and—
(a) the representative agent referred to in paragraph (1)(b); or
(b) the management of the establishment referred to in paragraph (1)(c)(i) or of the group undertaking, referred to in paragraph (1)(c)(ii),
shall be treated, respectively, as being the central management
In its unamended form regulation 4 dealt with the procedure for setting up an EWC and the way in which an EWC was to be conducted once established. Regulations 6 to 16 were concerned with the establishment of an EWC via requests made by employees. Regulations 17 to 41 dealt with the operation of an EWC. Complaints to the CAC were provided for in Regulations 21 and 21A. Those various provisions were only to apply where the central management was situated in the UK.
Regulation 5 in its unamended form established the duty on an undertaking to establish an EWC. The central management of the undertaking was to be responsible for creating the conditions necessary for the setting up of an EWC where one of three criteria applied: the central management was located in the UK; the central management was not situated in an EU member state and the representative agent of the central management was situated in the UK; neither the central management nor the representative agent were situated in an EU member state and, in respect of a Community-scale undertaking or group of undertakings, there were more employees of the undertaking in the UK than in any other EU member state.
The amendments to regulation 4 repealed the provisions concerned with the establishment of an EWC. Both parties to this appeal agree that the effect of these amendments is that, subject to any transitional provisions, no new EWC can be established after 31 December 2020. Regulation 4 otherwise was unamended. The critical words of the regulation for the purposes of this appeal are “…only where, in accordance with regulation 5, the central management is situated in the United Kingdom”. In its unamended form, regulation 5 created the duty on an undertaking to establish an EWC. This duty was repealed by...
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