ECJ on Notifications ahead of Mass Dismissals

Sept 1, 2023 Benn-Ibler Rechtsanwälte

The European Court of Justice (ECJ) has ruled that failing to send a copy of a written notification to the competent authority (in this case, the German employment agency, Agentur für Arbeit) that collective redundancies are imminent does not constitute individual protection for the employees concerned.

A German company intended to dismiss more than 10% of its workforce (which constituted a mass dismissal). The mandatory consultation procedure was initiated. In accordance with Section 17(2) of the German Law on Protection against Dismissal (Kündigungsschutzgesetz) and Article 2(3)(1)(b) of the EC Directive on collective redundancies (Directive 98/59/EC), the works council was informed in writing. However, contrary to Section 17(3) of the Dismissal Protection Act and Article 2(3)(2) of the Directive on collective redundancies, this notification was not forwarded to the German federal Agentur für Arbeit.

For this reason, an employee affected by the dismissal brought an action for a declaration that his employment relationship continued. He argued that the transmission of the written notice to the authority was a necessary condition for the validity of the dismissal. As this had not been done, the dismissal was null and void.

The German Federal Labour Court (Bundesarbeitsgericht), which heard the case, referred the matter to the ECJ for a preliminary ruling, which said:

Employee representatives are to be notified during the consultation procedure, i.e. before the actual collective redundancy procedure. The main purpose of notifying the authority is to keep it informed of the current situation and to prepare it to act should the dismissals actually be carried out. However, such a notification is only made at a stage when the employer definitely intends to carry out the dismissals but has not yet done so.

The breach of this obligation does not confer individual protection on the employees concerned, since the obligation to inform the authority during the consultation procedure is for information and preparatory purposes only.

ECJ C-134/22 (13 July 2023)