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UK Government could face Euro fines over Consultation Regulations

The European Commission has thrown its weight behind union complaints that the Collective Redundancies and Transfer of Undertakings (Protection of Employment) Regulations 1995 do not properly implement European Directives. A formal notice has been issued under Article 171 of the EC Treaty and the United Kingdom government could face cash fines from the European Court of Justice.

The Commission says the procedure for designating employee representatives is wrong and is not properly enforceable. UNISON, GMB and NASUWT used the same arguments in an unsuccessful judicial review challenge to the Regulations, as reported in Issue 1 of LELR (see Employers: duty to consult). The unions' appeal to the Court of Appeal will be heard in June 1997.

The Commission apparently shares the arguments put forward by the unions in the judicial review that the procedure for designating employee representatives is defective and that the Regulations do not provide effective sanctions where an employer fails to inform or consult the employees' representatives.

On 26 June 1996 the Commission gave the UK formal notice of its view that the Regulations did not correctly implement the Collective Redundancies and Acquired Rights Directives, as interpreted by the European Court in June 1994 when giving judgment against the UK.

The procedure now is for the UK Government to respond to the formal notice by submitting its observations. The Commission may then issue a reasoned opinion concerning the alleged non-compliance and, if the UK does not act, may complain to the European Court, specifying a lump sum or penalty payment. Ultimately it is for the European Court to decide whether there has been non-compliance and, if so, what the sanction should be.