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IMPORTANT LEGAL NOTICE - The source of this judgment is the web site of the Court of Justice of the European Communities. The information in this database has been provided free of charge and is subject to a Court of Justice of the European Communities disclaimer and a copyright notice. This electronic version is not authentic and is subject to amendment.
JUDGMENT OF THE COURT (Sixth Chamber)
17 December 1998 (1)
(Directive 75/129/EEC - Collective redundancies - Termination of the
establishment's operations as the result of a judicial decision)
In Case C-250/97,
REFERENCE to the Court under Article 177 of the EC Treaty by the Civilret,
Hillerød (Denmark), for a preliminary ruling in the proceedings pending before
that court between
Dansk Metalarbejderforbund, acting on behalf of John Lauge and Others
and
Lønmodtagernes Garantifond
on the interpretation of the second subparagraph of Article 3(1) and Article 4(4)
of Council Directive 75/129/EEC of 17 February 1975 on the approximation of the
laws of the Member States relating to collective redundancies (OJ 1975 L 48, p.
29), as amended by Council Directive 92/56/EEC of 24 June 1992 (OJ 1992 L 245,
p. 3),
THE COURT (Sixth Chamber),
composed of: G. Hirsch, President of the Second Chamber, acting as President of
the Sixth Chamber, G.F. Mancini, J.L. Murray, H. Ragnemalm (Rapporteur) and
K.M. Ioannou, Judges,
Advocate General: G. Cosmas,
Registrar: H. von Holstein, Deputy Registrar,
after considering the written observations submitted on behalf of:
- Lønmodtagernes Garantifond, by Ulf Andersen, of the Copenhagen Bar,
- the Commission of the European Communities, by Hans Peter Hartvig,
Legal Adviser, and Maria Patakia, of its Legal Service, acting as Agents,
having regard to the Report for the Hearing,
after hearing the oral observations of Dansk Metalarbejderforbund, acting on
behalf of John Lauge and Others, represented by Morten Langer, of the
Copenhagen Bar, Lønmodtagernes Garantifond, represented by Ulf Andersen, and
the Commission, represented by Hans Peter Hartvig, at the hearing on 18 June
1998,
after hearing the Opinion of the Advocate General at the sitting on 24 September
1998,
gives the following
Judgment
- By order of 4 July 1997, received at the Court on 9 July 1997, the Civilret (Civil
Court), Hillerød, referred to the Court for a preliminary ruling under Article 177
of the EC Treaty a question on the interpretation of the second subparagraph of
Article 3(1) and Article 4(4) of Council Directive 75/129/EEC of 17 February 1975
on the approximation of the laws of the Member States relating to collective
redundancies (OJ 1975 L 48, p. 29), as amended by Council Directive 92/56/EEC
of 24 June 1992 (OJ 1992 L 245, p. 3, hereinafter 'the Directive').
- The question was raised in proceedings between Dansk Metalarbejderforbund
(Danish Metalworkers' Federation, hereinafter 'the Metalarbejderforbund'), acting
on behalf of John Lauge and Others, and Lønmodtagernes Garantifond
(Employees' Guarantee Fund, hereinafter 'the Garantifond') concerning payment
by the latter to John Lauge and nine other employees of Ideal-Line A/S, a
company incorporated under Danish law, of 30 days' salary which, according to the
employees, their employer owes to them by reason of the fact that it did not
comply with Law No 414 of 1 June 1994, 'the Varslingslov' (Law on Notification
of Redundancies), which transposes the Directive into Danish law.
- Article 3 of the Directive provides:
'1. Employers shall notify the competent public authority in writing of any
projected collective redundancies.
However, Member States may provide that in the case of planned collective
redundancies arising from termination of the establishment's activities as a result
of a judicial decision, the employer shall be obliged to notify the competent public
authority in writing only if the latter so requests.
...'
- Article 4 of the Directive provides:
'1. Projected collective redundancies notified to the competent public authority
shall take effect not earlier than 30 days after the notification referred to in Article
3(1) without prejudice to any provisions governing individual rights with regard to
notice of dismissal.
...
4. Member States need not apply this Article to collective redundancies arising
from termination of the establishment's activities where this is the result of a
judicial decision.'
- The Directive was transposed into Danish law by Law No 414 of 1 June 1994. That
law provides for a derogation in accordance with the second subparagraph of
Article 3(1) and Article 4(4) of the Directive.
- On 2 November 1994 Ideal-Line A/S petitioned the Skifteret (Bankruptcy and
Probate Court), FÊaborg, for a winding-up order.
- On the same day all hourly-paid employees of Ideal-Line received verbal notice
that they were being made redundant with effect from the evening of 2 November
1994. The company's operations ceased from that point in time. The verbal notice
of redundancy was confirmed by letters of 3 November 1994.
- On 8 November 1994 the Skifteret, FÊaborg, issued a winding-up order, in which it
fixed the date on which the winding-up petition had been received ('fristdag') as
2 November 1994. Under Danish law the effects of insolvency are, for a number
of legal purposes, calculated from that date.
- The redundancies were not notified to the Danish public authority competent to
receive such notification under the Directive, the ArbejdsmarkedsrÊad, since the
redundancies were caused by the fact that the employer had filed a winding-up
petition.
- However, 10 employees of the Danish company considered that the redundancies
should have been notified and accordingly claimed 30 days' pay as compensation
for the failure to comply with the applicable provisions.
- The employees requested the Garantifond to meet that claim against the employer
pursuant to Law No 77 of 12 February 1988 on the Garantifond, as amended by
Law No 380 of 6 June 1991, which transposed Council Directive 80/987/EEC of 20
October 1980 on the approximation of the laws of the Member States relating to
the protection of employees in the event of the insolvency of their employer (OJ
1980 L 283, p. 23).
- The Garantifond rejected the claim on the ground that Ideal-Line A/S was not
obliged to notify the redundancies to the ArbejdsmarkedsrÊad because Mr Lauge
and the other claimants had in fact been made redundant when the employer's
activities terminated as a result of a judicial decision, namely that the company
should be wound up.
- On 11 April 1995 Dansk Metalarbejderforbund brought an action on behalf of John
Lauge and the other claimants against the Garantifond in the Civilret, Hillerød,
seeking a declaration that the persons concerned were not dismissed as the result
of a judicial decision, that being a precondition, under the second subparagraph of
Article 3(1) of the Directive, for derogation from the obligation to notify provided
for in that article.
- Since the Civilret, Hillerød, considered that an interpretation of the Directive was
needed before the dispute could be resolved, it stayed proceedings and referred the
following question to the Court:
'Does the phrase "collective redundancies arising from termination of the
establishment's activities as a result of a judicial decision" (see Article 3(1), second
subparagraph, and Article 4(4) of Directive 75/129/EEC, as amended by Directive
92/56/EEC) cover the case in which the collective redundancies occur on the same
day as that on which the employer filed a winding-up petition and terminated the
undertaking's activities, and the Skifteret subsequently, and without any deferment
other than that resulting from the date which the court set for the hearing, issues
a winding-up order pursuant to the winding-up petition and takes the date of that
winding-up petition as the operative date?'
- By its question the national court is asking essentially whether the second
subparagraph of Article 3(1) and Article 4(4) of the Directive must be interpreted
as meaning that the derogations for which they provide apply to collective
redundancies occurring on the same day as that on which the employer files a
winding-up petition and terminates the undertaking's activities, and the competent
court subsequently, and without any deferment other than that resulting from the
date which it sets for the hearing, issues a winding-up order pursuant to the
winding-up petition which takes effect for a number of purposes from the date on
which the petition was filed.
- The Garantifond submits that the question should be answered in the affirmative.
It maintains that the collective redundancies which gave rise to the dispute in the
main proceedings are directly covered by the wording of the second subparagraph
of Article 3(1) and Article 4(4) of the Directive, even though they took place
before the winding-up order. Since Ideal-Line A/S was insolvent, the winding-up
was a reality at the time when the winding-up petition was filed. The fact that the
winding-up order was not made on the day on which the petition was filed was due
solely to the schedule of hearings in the Skifteret, which did not enable the petition
to be dealt with immediately. It is, moreover, for that reason that Danish law
provides that winding-up takes effect for a number of legal purposes retroactively,
from the date on which the petition is filed.
- The Garantifond contends further that an interpretation of the Directive in the
light of its purpose would suggest that the situation in point in the main
proceedings should be treated in the same way as a situation in which redundancies
take place following a winding-up order. In both cases the redundancies are
motivated by the need to terminate the activities of the establishment because they
are being pursued at a loss and the employer is insolvent, so that the employer's
assets must be made the subject of a winding-up order.
- It must be noted that the wording of the second subparagraph of Article 3(1) and
Article 4(4) of the Directive indicates clearly that the termination of the activities
of the establishment and the collective redundancies must not take place prior to
the judicial decision, which consists, in a case such as that in the main proceedings,
in a winding-up order. The fact that certain effects of the winding-up are
retroactive from the date on which the winding-up petition is filed, as the national
legislation provides, does not affect that conclusion.
- That interpretation is confirmed by the purpose of the Directive. It is clear from
the first recital in its preamble that the Directive is aimed at affording protection
to workers in the event of collective redundancies. As the Commission observed,
that purpose was reinforced by the amendment introduced by Directive 92/56,
which extended application of the Directive to the case where the termination of
activities is the result of a judicial decision, subject to recourse to the possibility of
derogation provided for in the second subparagraph of Article 3(1) and Article
4(4). In order not to jeopardise the attainment of the fundamental objective
pursued by the Directive, that derogation must be construed narrowly.
- In the light of the foregoing, the reply to the question referred to the Court must
be that the second subparagraph of Article 3(1) and Article 4(4) of Directive
75/129/EEC is to be interpreted to the effect that the derogations provided for
therein do not apply to collective redundancies occurring on the same day as that
on which the employer files a winding-up petition and terminates the undertaking's
activities, and the competent court subsequently, and without any deferment other
than that resulting from the date which it sets for the hearing, issues a winding-up
order pursuant to the winding-up petition, that order taking effect for a number of
purposes from the date on which the petition was filed.
Costs
21. The costs incurred by the Commission, which has submitted observations to the
Court, are not recoverable. Since these proceedings are, for the parties to the main
proceedings, a step in the action pending before the national court, the decision on
costs is a matter for that court.
On those grounds,
THE COURT (Sixth Chamber),
in answer to the question referred to it by the Civilret, Hillerød, by order of 4 July
1997, hereby rules:
The second subparagraph of Article 3(1) and Article 4(4) of Council Directive
75/129/EEC of 17 February 1975 on the approximation of the laws of the Member
States relating to collective redundancies, as amended by Council Directive
92/56/EEC of 24 June 1992, must be interpreted to the effect that the derogations
provided for therein do not apply to collective redundancies occurring on the same
day as that on which the employer files a winding-up petition and terminates the
undertaking's activities, and the competent court subsequently, and without any
deferment other than that resulting from the date which it sets for the hearing,
issues a winding-up order pursuant to the winding-up petition, that order taking
effect for a number of purposes from the date on which the petition was filed.
|
HirschMancini
Murray
RagnemalmIoannou
|
Delivered in open court in Luxembourg on 17 December 1998.
R. Grass
P.J.G. Kapteyn
Registrar
President of the Sixth Chamber
1: Language of the case: Danish.
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