High Court of Ireland Decisions

THE HIGH COURT

[2025] IEHC 141

[Record No. HCA 2024/228]

BETWEEN

DEBENHAMS RETAIL IRELAND LIMITED (IN LIQUIDATION)

APPELLANT

AND

 

JANE CROWE

RESPONDENT

JUDGMENT of Mr Justice Barr delivered electronically on the 7th day of March 2025.

Introduction.

1.                  This is an appeal by the appellant against a decision of the Labour Court (PED 241) dated 10 April 2024. In that decision the Labour Court found that the appellant, qua employer, had been in breach of its obligations under s.9 of the Protection of Employment Act, 1977 (as amended) (hereinafter 'the 1977 Act').

2.                  It is important to note that the 1977 Act was further amended in 2024. This judgment deals with the version of the 1977 Act in force as of April 2020.

3.                  Section 9 of the 1977 Act provides that where an employer proposes to create collective redundancies, he shall, with a view to reaching agreement, initiate consultations with employees' representatives. Those consultations shall include the possibility of avoiding the proposed redundancies, reducing the number of employees affected by them or mitigating their consequences by recourse to accompanying social measures aimed, inter alia, at aid for redeploying or retraining employees made redundant. The section further provides that consultations under the section shall be initiated at the earliest opportunity and, in any event, at least 30 days before the first notice of dismissal is given.

4.                  The issues that arise in this appeal can be summarised in the following way: the appellant was a wholly owned subsidiary of an English group of retail shops. The Irish subsidiary had shops throughout the Republic of Ireland. It had been in examinership in 2016. It had traded at a loss in the years 2017–2019. It had only been able to continue trading due to extensive financial support provided to it by its parent company in the years following 2016.

5.                  At 21.35 hours on 8 April 2020, the Board of Directors of the appellant received devastating news from its parent company in the UK. The parent company stated that it would not provide any further funding to the Irish subsidiary. The appellant was therefore hopelessly insolvent.

6.                  On the following day, 9 April 2020, the Board of Directors of the appellant met and resolved, inter alia, to advise the parent company that they should instruct the directors of the Irish company to seek the appointment of provisional liquidators to the appellant.

7.                  On 14 April 2020, the administrators of the UK parent company directed the Board of Directors of the appellant to seek the appointment of provisional liquidators. In an email of the same date, one of the directors of the appellant provided the respondent's trade union representative with information about the proposed redundancies.

8.                  By further email on 15 April 2020, she advised the union representative that there would be a meeting on 17 April 2020 between management and the union to discuss the issue of collective redundancies, among a range of issues that had arisen due to the imminent appointment of provisional liquidators to the appellant.

9.                  On 16 April 2020, provisional liquidators were appointed over the appellant company.

10.              On 17 April 2020, the first consultative meeting was held between the provisional liquidators, the Board of Directors of the appellant and the respondent's trade union representatives.

11.              The Labour Court held that the consultation process required under s.9 of the 1977 Act ought to have started on 9 April 2020. The Court found that the consultation process did not start until 17 April 2020, as a result whereof, certain options to ameliorate the effect of the collective redundancies were no longer available. The Labour Court awarded compensation to the respondent.

12.              That award was by way of a test case. There are approximately 792 other cases concerning employees in a similar position to that of the respondent.

13.              The appeal to this Court is an appeal on a point of law. The appellant submits that the Labour Court was wrong as a matter of law in holding that the obligation to commence consultations under s.9 of the 1977 Act arose on 9 April 2020; that the Labour Court erred in law in finding that the process only commenced with the holding of the first consultation meeting on 17 April 2020; and that the Labour Court erred in law in finding that available options had been lost by that delay of eight days; and that there was no basis in law for awarding compensation to the respondent.

14.              The grounds of appeal and the respondent's response thereto will be set out in detail later in the judgment.

Chronology.

15.              In order to properly understand the issues that arise for determination in this case it is necessary to set out the chronology of events that occurred between 6 April 2020 and 17 April 2020 in some detail.

16.              On 6 April 2020, the appellant's parent company in the UK announced that administrators were to be appointed to the parent company. On 8 April 2020, the Board of Directors of the appellant having enquired of the parent company whether funding would continue to be provided to the appellant by the parent company, a response was sent by the parent company in the UK to the appellant at 21.35 hours stating that funding would no longer be provided to the appellant. That letter was in the following terms:

"We refer to your letter dated 8 April 2020 and write to confirm that neither Debenhams Retail Ltd (or any administrator appointed to it) nor any other entity will be in a position to provide financial support to Debenhams Retail (Ireland) Ltd going forward."

17.              At 08.30 hours on 9 April 2020 a meeting of the Board of Directors of the appellant was held. At that meeting, the Board of Directors discussed what actions the company should take in light of the receipt of the letter from its parent company on the previous evening. The Board of Directors passed a number of resolutions including the following: that the company could not continue trading as a going concern; that the company would issue a letter from the Board addressed to the Board of the parent company recommending that the parent company, in its capacity as sole shareholder of the appellant, would take immediate steps to petition the Irish High Court to wind up the appellant and to have a liquidator appointed to the company; that a letter to the company's employees should be issued informing them of the position; that Ms Sinead O'Connor, a member of the Board of Directors, would contact the managers of each of the Irish Debenhams stores and the relevant trade unions and advise them in relation to the matter. The Board also resolved to do the following in relation to collective redundancies:

"The Board would consider and undertake to do the various requirements regarding collective redundancies under the relevant employment legislation (as per advice to be provided by William Fry), including the issuing of a notification to the relevant government minister."

18.              Also on 9 April 2020, a letter was written by John Bebbington, a member of the appellant's Board of Directors, to the employees in the Irish stores, informing them of the developments that had occurred since the previous evening. The employees were told that it was anticipated that application would be made to the High Court to appoint a provisional liquidator at some time in the following week. The letter stated that "Regrettably, due to the challenges facing Debenhams Retail (Ireland) Ltd, it is anticipated that an application will be made to appoint a liquidator to the Irish operations." The letter went on to state that the company had already suspended trading in the Republic of Ireland stores due to Covid. The letter stated that the stores were not expected to reopen. The letter further stated that its primary purpose was to inform employees of the decision to put the company into liquidation. It stated that further communication would follow from the liquidator in due course. The letter ended by thanking the employees for their dedicated service to the company throughout the years.

19.              On 9 April 2020, administrators were formally appointed over the UK parent company. On the same date, the Board of Directors of the appellant sought legal advice from their Irish solicitors.

20.              At 12.14 hours on 10 April 2020, the appellant received advices by email from the Irish solicitors. This included advice in relation to the timeline for imposing collective redundancies. The advices also set out all the statutory requirements and the times for complying with these.

21.              Over the Easter Bank Holiday weekend, which was from 11–13 April 2020, there were informal contacts between Ms O'Connor and the respondent's trade union representative, Mr Gerry Light. Over the weekend, Ms O'Connor also spent time answering FAQs that had been submitted by the employees on the company portal and collated information for the purpose of furnishing same to the union representatives.

22.              On 14 April 2020, which was the Tuesday after Easter Sunday, the administrators of the UK parent company passed a resolution directing the Board of Directors of the Irish subsidiary to seek the appointment of provisional liquidators to the company.

23.              At 18.53 hours on 14 April 2020, Ms O'Connor sent a letter by email to Mr Light, in which she set out information in relation to the proposed collective redundancies. In that letter she set out the reasons for the proposed redundancies, the number and description or categories of employees whose roles were being proposed for redundancy; the total number of persons normally employed; the period during which the proposed terminations were expected to take effect; the criteria proposed for the selection of workers to be made redundant; and the method of calculating the redundancy payments that would be made to the employees. The letter stated that all employee roles within the company in Ireland were proposed for redundancy.

24.              At 14.04 hours on 15 April 2020, Mr Light sent an email to Ms O'Connor, reminding her of the additional obligation placed on the employer resulting from the proposed action to impose collective redundancies. She was reminded that the employer from that point forward was obliged to engage in meaningful consultations with employee representatives. He went on to state that he believed that such engagement had not occurred. He stated that he was repeating the union's previous request that the employer should immediately suspend its intention to place the company into liquidation in order to ensure that the above-mentioned legal requirements could be met satisfactorily.

25.              At 19.52 hours, Mr Light sent an email to Mr Robert McNamara, also of the Mandate trade union, informing him that he had just had a telephone call with Ms O'Connor, who had confirmed that the company intended to petition the courts on the following day for the appointment of a provisional liquidator. She also confirmed that the company/liquidator were prepared to commence some form of consultation process with the union. He stated that Ms O'Connor had stated that she would confirm the above by way of email later in the evening.

26.              At 20.02 hours on the same date, Ms O'Connor sent an email to Mr Light informing him that the company could attend the first consultation meeting via Zoom on 17 April 2020 at 11.00 hours. She stated that in an attempt to aid the meeting, they had logged and answered the FAQs which they had received via the HR Connect ROI email address, via individual emails and questions raised through store managers. She stated that they had received over 60 questions; however, with repetition, there were around 30 questions which they had answered to the best of their knowledge at that stage. She stated that she would send the FAQs by lunchtime on the following day to Mr Light, to allow him time to distribute them to his national committee prior to the meeting on 17 April 2020.

27.              On 16 April 2020, an application was made to the High Court to appoint provisional liquidators to the appellant company. That application was granted. The petition set out the grounds on which the appointment of a provisional liquidator was sought. It set out in stark terms that the company was heavily insolvent.

28.              By email sent at 13.31 hours on 16 April 2020, Ms O'Connor informed Mr Light of the appointment of provisional liquidators. Mr Light had already been given a copy of the papers used to ground the petition for the appointment of provisional liquidators.

29.              On the same date, a letter was sent to the employees by Mr Bebbington informing them that the company was insolvent and that provisional liquidators had been appointed over the company. The letter further informed them that it was proposed that a collective redundancy situation would occur. Under the heading "What Happens Next", the employees were advised that the appointment of the provisional liquidators would allow the Board of Directors to progress to the next stage, which would involve collective consultation with their union representatives. They were informed that the first such meeting had been arranged for Friday, 17 April 2020 at 11.00 hours.

30.              On 17 April 2020 the first consultation meeting was held. It was attended by the provisional liquidators, the Board of Directors of the company, and union representatives. It was held via Zoom, due to the Covid restrictions in place at the time.

The Labour Court's Decision.

31.              The decision of the Labour Court, bearing reference PED 241, which was delivered on 10 April 2024, was a decision on appeal brought by the appellant against a decision of the adjudication officer dated 15 May 2023, which had found the appellant in breach of the provisions of ss. 9 and 10 of the 1977 Act (as amended). The adjudicating officer had also awarded compensation in favour of the respondent.

32.              The Labour Court had the benefit of considerable documentation in relation to the matter. It also had the benefit of written and oral legal submissions. The Labour Court also heard oral evidence from witnesses on behalf of the appellant and the respondent.

33.              In its written decision, the Labour Court set out the background to the appeal before it; it summarised the case made by the complainant, being the employee; it set out the submissions that were made by counsel appearing on behalf of the parties. It set out an account of the oral evidence that had been given by the various witnesses who had given evidence before it, and it set out a statement of the legal principles applying to the appeal.

34.              Having dealt with the submissions and the evidence in some detail, the Labour Court went on to make the following findings. First, it dealt with the question as to when the consultation process commenced between the employer and the employees. The Court held that having regard to correspondence issued in April 2020 from the provisional liquidators, who had subsequently been confirmed as liquidators of the company, and in particular, having regard to the fact that in that correspondence they had acknowledged that the consultation process began with the meeting held on 17 April 2020, the Labour Court formed the view that the consultation process had begun with the holding of the first consultation meeting on that date.

35.              The court noted that while an email had been sent by Ms O'Connor on 14 April 2020, furnishing information in relation to the proposed collective redundancies, there had been no mention of consultation as provided for under s.9 of the Act in that letter.

36.              The court further pointed out that by her email dated 15 April 2020, Ms O'Connor had confirmed that the respondent could attend the first consultation meeting on Friday 17 April 2020. The Court also referred to the correspondence that had been sent by Mr Bebbington to the employees. The Court stated that it was clear from the correspondence before it, that the appellant at that point, was not disputing the fact that consultation had not started, but rather was indicating that the consultation would commence on 17 April 2020. The court stated that that position was confirmed by the statement made by Ms O'Connor at the meeting held on 17 April 2020, that there had been "radio silence" in terms of communication between the appellant and the workers from when the employees had received the letter on 9 April 2020, to the meeting on 17 April 2020. The Labour Court summarised its conclusion in the following way:

"Finally, it is clear from the documents opened to the court, that the directors of the respondent and the liquidators in their correspondence and engagements with the union and the employees, all acted in a manner that supports the complainant's submission that the consultation process commenced on 17 April 2020. The court having considered the relevant facts finds that the consultation process commenced on 17 April 2020."

37.              The second question addressed by the Labour Court was whether the consultation had started "in good time/at the earliest opportunity", as required by the Directive and the Act of 1977. In answering this question, the Labour Court noted that in the minutes of the meeting of the Board of Directors of the appellant held on 9 April 2020, it was recorded that the Board "would consider and undertake to do the various requirements regarding collective redundancies under the relevant employment legislation (advice to be provided by William Fry), including the issuing of a notification to the relevant government minister". The Court found that that entry in the minutes pointed to the appellant at that time being aware of its responsibilities under the 1977 Act and being aware that collective redundancies were a probability.

38.              The Labour Court went on to note that the documentation before it showed that an email had been provided to the respondent prior to lunchtime on the following day from their legal advisers which enclosed draft documents concerning their obligations in relation to the issue of collective redundancies. The Court stated that it was difficult to see how, at that point, the respondent could not be considered to be contemplating redundancies, as the minutes of the board meeting, along with the evidence of Mr Deegan, a member of the Board of Directors, had dispelled any notion that a decision had not been made at that point that could result in collective redundancies.

39.              The Labour Court referred to the decision of the CJEU Akavan Erityisalojen Keskusliitto AEK v Fujitsu Siemens Computers OY (Case C– 44/08) where it had been held that the Directive had to be interpreted to mean that the adoption within a group of undertakings of strategic decisions or of changes in activities which compel the employer to contemplate or to plan for collective redundancies, gives rise to an obligation on the employer to consult with the workers' representatives.

40.              Applying that legal definition to the case before it, the Labour Court held that there had been a gap in time between the decision to write to the sole shareholder and proceeding to the High Court. The Court held that for there to be any possibility of reaching agreement with the unions, it seemed that the consultation process should have commenced at that point in time, where it had become clear that collective redundancies were going to be a feature. The correspondence suggested that that occurred on 9 April 2020. The court formulated its conclusions on this question in the following terms:

"The court having considered all of the above, concludes that the consultation did not commence in good time and/or at the earliest opportunity. By delaying the consultation until after the liquidators had been appointed the respondent limited the options available in terms of coming to an agreement."

41.              The Labour Court went on to consider when the consultations should have commenced. In this regard, it appeared to the Court that the earliest opportunity to commence consultations was on 9 April 2020, after the Board had passed the resolution that the company would cease trading.

42.              The Labour Court pointed out that it was clear from the case law that there was no requirement on the company to have all relevant information available before commencing the consultation process. The court stated that on the evidence before it, it appeared that the Board of Directors of the appellant were of the view that the consultations did not have to happen until after the liquidators were appointed. The Court stated that were that to be true, it would defeat the purpose of the Act, as the options available for consideration narrow considerably once liquidators are appointed and the directors lose control of the company.

43.              The Labour Court went on to note that while the delay between 9 April 2020 and 17 April 2020 could be argued to be only eight days, this was nonetheless significant. They held that in the circumstances of the case, taking into account the precarious position of the company, by not commencing consultations until 17 April 2020, at which time the provisional liquidators had been appointed, the impact was that the available options had been narrowed, as the High Court had agreed to the commencement of the process of winding up the company. The Labour Court stated that having considered all of the above, it found that the consultation process should have started on 9 April 2020 and the fact that it did not commence until 17 April 2020, meant that the appellant had not complied with the requirements of s.9 of the 1977 Act.

44.              The Labour Court concluded its decision in the following terms:

"For the reasons set out above, the court finds that while the respondent did engage in consultation for 30 days prior to the notice of redundancy issuing, they failed to hold meaningful consultations in good time and that in waiting until the liquidator was appointed the available options had narrowed significantly. The court finds that this constitutes a breach of s.9 of the Act. The court decides that the appropriate compensation is four weeks pay. The decision of the adjudication officer is upheld. The court so decides."

45.              On this aspect of the case, the adjudication officer had awarded the respondent four weeks compensation, which amounted to €1,140.

The Legislation.

46.              The primary piece of EU legislation is Article 2 of Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective redundancies (hereinafter 'the Directive'). The Critical provision is Article 2.1 which is in the following terms:

"Where an employer is contemplating collective redundancies, he shall begin consultations with the workers' representatives in good time with a view to reaching an agreement."

47.              Article 2.2 provides that the consultations with the workers' representatives shall at least cover ways and means of avoiding collective redundancies or reducing the number of workers affected and of mitigating the consequences by recourse to accompanying social measures aimed, inter alia, at aid for redeploying or retraining workers made redundant.

48.              Article 2.3 sets out the information that must be supplied to the workers' representatives in good time during the course of the consultations. An employer is obliged to provide them with all relevant information and in particular to notify them in writing of the following: the reasons for the proposed redundancies; the number and categories of workers to be made redundant; the number and categories of workers normally employed; the period over which the projected redundancies are to be effected; the criteria proposed for the selection of the workers to be made redundant; and the method for calculating any redundancy payments other than those arising out of national legislation and/or practice.

49.              The provisions of the Directive were implemented in Irish law by means of ss. 9 and 10 of the 1977 Act. Section 9 thereof is in the following terms:

"9.—(1) Where an employer proposes to create collective redundancies he shall, with a view to reaching an agreement, initiate consultations with employees' representatives.

(2) Consultations under this section shall include the following matters—

(a) the possibility of avoiding the proposed redundancies, reducing the number of employees affected by them or mitigating their circumstances by recourse to accompanying social measures aimed, inter alia, at aid for redeploying or retraining employees made redundant.

(3) Consultations under this section shall be initiated at the earliest opportunity and in any event at least 30 days before the first dismissal takes effect."

50.              Section 10 of the 1977 Act provides that for the purpose of consultations under s.9, the employer concerned shall supply the employees representatives with all relevant information relating to the proposed redundancies. The section sets out specific information which must be supplied during the consultations. This is effectively the same information as set out at Article 2.3 of the Directive.

The Law.

51.              The law in relation to the jurisdiction enjoyed by the court when it is hearing an appeal on a point of law from a decision of a lower court or tribunal, has been considered in a number of cases. The principles involved were usefully summarised at section 7 of the concurring judgment of Clarke J (as he then was) in Fitzgibbon v The Law Society [2015] 1 IR 516.

52.              That summary was endorsed by the Supreme Court in on An Bord An Bord Banistíochta, Gaelscoil Moshíológ v The Department of Education & ors [20 24] IESC 38. Delivering the judgment of the court, the Chief Justice cited with approval the dicta of McKechnie J in Deely v Information Commissioner [2001] IR 439, as summarised by Gilligan J in ESB v Minister for Social, Community and Family Affairs [2006] IEHC 59, as to the jurisdiction of a court hearing an appeal on a point of law:

"The remit of the Court in an appeal on a point of law encompassed the following:

(a) it cannot set aside findings of primary fact unless there is no evidence to support such findings,

(b) it ought not set aside inferences drawn from such facts unless such inferences were ones which no reasonable decision-making body could draw;

(c) it can however reverse such inferences, if the same were based on the interpretation of documents and should do so if incorrect, and finally,

(d) if the conclusion reached by such bodies shows that they have taken an erroneous view of the law, then that also is a ground for setting aside the resulting decision."

53.              The Supreme Court went on to emphasise that an appeal on a point of law is not a rehearing. Facts found by the lower court or tribunal are binding on the appellate court when those facts are supported by credible evidence. The appellate court must be mindful that its own view of the decision arrived at by the lower court, is irrelevant. The Chief Justice summarised this aspect by stating as follows at para. 57:

"As observed in the decisions, the test can also be understood negatively; whatever the precise limits of an appeal to the High Court on a point of law, it is not a rehearing. The appellate body does not hear evidence, and is not free to substitute its findings for that of the decision-maker."

54.              At para. 60 of its judgment, the Supreme Court reiterated that an appeal on a point of law is not a rehearing. It stated that the appellate court does not retry the issues and substitute its own view of the merits for that of the primary decision-maker, particularly since its understanding of the facts is gleaned through the imperfect prism of a transcript. Its view of the merits is not the issue and is not a legally relevant factor.

55.              The Supreme Court emphasised that the maintenance of this distinction in roles wa s important, particularly in relation to appeals from the Labour Court. The Chief Justice stated as follows at paragraph 61:

"The maintenance of this distinction is important in practice. Here, for example, the State has provided for a first hearing before an independent adjudicator, with experience in the field of employment. It has also provided for a full appeal to the Labour Court - a body composed of representatives of employers and employees and persons with legal qualification and experience. In theory this procedure is meant to be shorter, more informal and less costly than parallel proceedings in court. A decision-maker with expertise built up through a succession of cases can accumulate a valuable sense of the range of issues that arise and set a particular case in its context and may have a well-developed sense of the seriousness of any particular case. Furthermore, such decision-makers may have experience in applying appropriate remedies in particular situations."

56.              Turning to the central issues that arise on this appeal, being when the obligation on the employer to hold consultations with the workers' representatives in relation to collective redundancies, arises and what is meant by consultation under the Directive, has been considered in a number of decisions of the CJEU.

57.              The earliest relevant decision was in Dansk Metalarbejderforbund v H. Nielsen Søn, Maskinfabrik A/S, in liquidation (Case 284/83). This decision rela ted to the earlier directive on collective redundancies of 1975. Article 2 thereof imposed an obligation on an employer to hold consultations with workers' representatives when it was contemplating collective redundancies. However, it did not have the important proviso, which is in the subsequent directive, that such consultations had to be "in good time with a view to reaching agreement".

58.              One of the questions posed to the CJEU was whether the Directive applied in circumstances where because of the financial state of the undertaking, the employer ought to have contemplated collective redundancies but did not do so. In answering that question, the court held that the Directive applied only where the employer had in fact contemplated collective redundancies or had drawn up a plan for collective redundancies.

59.              The decision of the CJEU in Akavan v Fujitsu Siemens (Case C-44/08)  is of more relevance because it dealt with Article 2 of the Directive as it applies in this case. It was also considered by the High Court in its decision in Tangney v Dell Products Ltd [2013] IEHC 6 22.

60.              In his opinion in the Akavan case, Attorney General Mengozzi noted that in the Dansk case, the CJEU had held that the obligation to hold consultations applied only where the employer had in fact contemplated collective redundancies, or had drawn up a plan for collective redundancies: see para. 5 0.

61.              The Advocate General opined that it was clear from a comparison of the different language versions of Article 2.1, that the Directive meant that the obligation provided for by that provision was to arise from the existence of an intention on the part of the employer to make collective redundancies.

62.              In the subsequent decision of the CJEU in Akavan , having noted the dangers of a premature triggering of the obligation to hold such consultations (see paras. 45 and 46), the court went on to hold that the consultation process must be started by the employer once a strategic or commercial decision compelling him to contemplate or to plan for collective redundancies has been taken.

63.              The decision of the CJ E U in Akavan was considered by Birmingham J (then sitting as a judge of the High Court) in Tangney v Dell, which was decided in June 2013. He referred to the decision of the CJ E U in United States v Nolan (Case C–583/10), where the court had declined jurisdiction because the case involved a civilian working at a US airbase in Britain. However, he noted that the US government had argued by reference to the Akavan case that the consultation obligation was not triggered by a proposed business decision to close a plant, but that the consultation obligation only arose at a later stage, when the business decision had already been made and the intention to make the employees redundant had been formed.

64.              Birmingham J noted that Advocate General Mengozzi in the Nolan case, had agreed with the interpretation contended for by the Commission and the EFTA Surveillance Authority. The Advocate General had opined that in deciding the question of when the obligation was triggered, particular regard had to be paid to the events that actually occurred in the case. Advocate General Mengozzi summarised his opinion as follows at para. 49:

"In my view, the method to be used by the referring court should be to identify which of the events mentioned in the order for reference which occurred before 5 June 2006 was in the nature of a strategic decision and exerted compelling force on the employer for the purpose of giving effect to the consultation obligation, and the date on which that decision was made."

65.              Birmingham J ultimately decided the case on the basis of the facts as found by the Employment Appeals Tribunal ("EAT"), which had found that as a matter of fact, the communication by the respondent company on 8 January 2009 had not constituted notice of dismissal and that the employer had commenced the consultation process at an appropriate stage. Birmingham J stated that it seemed to him that the reference to the entitlement of the employer to make a strategic decision in the concluding paragraph of the determination, had to mean that the EAT was taking the view that the employer had embarked on consultations, as it was obliged to do, when a strategic or commercial decision compelling it to contemplate or plan for collective redundancies had been taken.

66.              Thus, it may fairly be said that while the decision in Tangney adopts the reasoning of the CJEU in a Akavan , it does not decide when exactly the obligation to hold consultations is triggered, having regard to the alleged lack of clarity in the judgment of the CJEU in Akavan.

67.              In the course of his judgment, Birmingham J had noted that the Court of Appeal in England had found the decision of the CJEU in Akavan was not straightforward. Having conducted a review of the opinion of the Advocate General in that case, and having regard to the judgment of the CJEU, the Court of Appeal in England had concluded that it would venture no further views on the true interpretation of the judgment in Akavan , which it respectfully regarded as unclear. As noted above, Birmingham J was able to decide the issues which arose in the Tangney case on the basis of the facts as found by the lower tribunal.

68.              In argument at the bar, counsel referred to the opinion of Advocate General Sharpston in Bichat & Ors. v APSB Aviation Passage Services Berlin GmbH (Case C-61/17) where the Advocate General had noted that the aim of the consultation process was, where possible, to avoid the need for the projected collective redundancies altogether. Where that could not be achieved - and it had to be assumed that in many cases it would not be - their number should be reduced or the consequences should be mitigated, all to the degree possible in the circumstances. The Advocate General stated that the obligation to participate was at all times on the employer; it was not on the undertaking having control, even though it was clear that the duty to hold consultations could arise in situations where the prospect of those redundancies was not directly the employer's choice. To that end, it was stated that the employer must begin the consultations "in good time with a view to reaching agreement" and the workers' representatives should be placed in a position to make "constructive proposals". (See para. 43).

69.              As to the time when the obligation is triggered, Advocate General Sharpston opined that the employer was under a duty to start the consultation process under the Directive when it became aware of the adoption of a st rategic decision or change in activities which compelled it to contemplate or plan for collective redundancies.

70.              In the Bichat case, the CJEU held that in view of its answer to the first question referred to it as to the meaning of the term "undertaking controlling the employer", it did not have to answer the remaining questions on which Advocate General Sharpston had opined.

71.              Finally, in JLOG v Resorts Majorca Hotels International SL (Case C–589/22), the CJEU considered the time at which the consultation obligation arose in the context of a restructuring plan. Having referred to the existing case law, it held that Article 2.1 had to be interpreted as meaning that the consultation obligation arose at the time when the employer, in the context of a restructuring plan, contemplated or planned a reduction of employment positions, the number of which may exceed those fixed in Article 1.1(a) of the Directive; and not when, after having adopted measures involving the reduction of that number, the employer became certain that it would in fact have to dismiss a number of workers greater than those fixed by the latter provision.

72.              It should be noted that the facts of that case were quite different to the facts in the present proceedings. In the JLOG case, the reduction in staff numbers came about in a piecemeal fashion over a period of five months on foot of a restructuring plan and a period of voluntary departures. As a result of the piecemeal nature of the reduction, the respondent company in that case had never engaged in any consultation process. On this basis, that case is markedly different to the case before the court.

73.              It can be seen from the above review of the case law, that there is a difficult and nuanced question as to when exactly the obligation on an employer to engage in consultations, is triggered. Is it when the employer first considers a course of action which could involve the possibility of collective redundancies being made; or is it when a decision is taken, which compels the employer to consider making collective redundancies?

74.              This is a very important question having regard to the fact that under the amendment made to the 1977 Act by The Employment (Collective Redundancies and Miscellaneous Provisions) and Companies (Amendment) Act, 2024, a "responsible person" as defined in the Act, who fails to initiate consultations under s.9, or fails to comply with the provisions of s.10, shall be guilty of an offence, liable on summary conviction to a class A fine.

75.              It is also a difficult question to answer, because boards of directors of many companies, small and large, may have to consider a range of options at various times, some of which may include making some or all of the workforce redundant. However, on a full consideration of the available options, or due to a change in the trading environment, those options which would involve making collective redundancies, may never come to fruition. In these circumstances, care is needed in deciding when exactly the obligation to hold consultations is triggered.

76.              However, for reasons that will be set out later in the judgment, I am satisfied that in this case it is not necessary to grapple with this difficult issue.

Conclusions.

77.              At the outset, Mr Kirwan SC, raised a preliminary point to the effect that the appellant had proceeded under the wrong order in the Rules of the Superior Courts. It was alleged that the appellant had incorrectly proceeded under Order 106, rather than Order 105. However, counsel accepted that in the notice of motion grounding the appeal the appellant had also sought relief from the court pursuant to its inherent jurisdiction. He did not press this argument strongly.

78.              It has been stated in many previous cases that the rules of court are the servants of justice, not its master. The days when an appeal could be defeated by such a technical objection are long gone. There is no substance to this ground of objection. If it had been necessary to do so, I would have granted the appellant liberty to amend its notice of appeal. Counsel for the respondent was correct not to press the point too strongly.

79.              Before turning to the substantive issues on this appeal, I accept the submission made by Ms Smith SC for the appellants, that in considering whether any breach of the Directive, or the Act of 1977, had occurred, it was incumbent on the Labour Court to examine the events that occurred in the period 8 April 2020 to 17 April 2020.

80.              Included in a consideration of these events, account must be taken of the fact that these events took place during a period of unprecedented lockdown due to Covid. In addition, the critical events took place in the period leading up to and after the Easter Bank Holiday weekend in 2020.

81.              The letter from the UK parent company informing the appellant that funding was being withdrawn, arrived at 21.35 hours on Wednesday, 8 April 2020. The meeting of the Board of Directors took place on the following morning, being Holy Thursday. The 10 April 2020 was Good Friday and the following three days were the Easter Bank Holiday weekend. The 14 April 2020 was the Tuesday after Easter. The provisional liquidators were appointed over the appellant on Thursday of that week and the first consultative meeting between the provisional liquidators, the Board of Directors and the union representatives was held on the morning of Friday, 17 April 2020.

82.              I accept that in considering the obligation contained in s. 9(3) of the 1977 Act, to hold consultations "at the earliest opportunity", this has to be considered within the practicalities of life on the ground at that time.

83.              The first substantive question which has to be addressed in this appeal is whether the finding by the Labour Court that the obligation on the appellant, qua employer, to commence consultations arose on 9 April 2020, when the Board of Directors of the appellant met to consider the letter from the parent company withdrawing funding, which had been received at 21.35 hours on the previous evening.

84.              The appellant argued that the obligation to hold consultations only arose on 14 April 2020 when the Board of Directors of the appellant received the resolution from their parent company in the UK directing them to seek the appointment of provisional liquidators to the appellant. The appellant submits that it was only at that stage that it was compelled to consider the reality that collective redundancies would have to be made.

85.              The Labour Court found that the obligation to commence consultations arose on 9 April 2020 because at that stage the Board had resolved that the company was insolvent and that it would have to cease trading.

86.              I am satisfied that the finding by the Labour Court in this regard was based on evidence that was before it. In particular, having regard to the dire financial and trading history of the appellant, as set out in the petition presented to the High Court seeking the winding up of the appellant, it had to be apparent to the Board of Directors that collective redundancies would have to be made once ongoing funding was withdrawn by the UK parent company.

87.              In reaching its conclusion on this matter, the Labour Court had had regard to the resolutions passed by the Board of Directors of the appellant at its meeting on  9 April 2020. Those resolutions included inter alia , a resolution that the company could not continue trading as an ongoing concern; that the company would issue a letter to its parent company recommending it to direct the Board of Directors of the appellant to seek the winding up of the appellant; that a letter should be issued to the company's employees informing them of the position; and in particular it was resolved at item 6.1.10 that the Board would consider and undertake to do the various requirements regarding collective redundancies under the relevant employment legislation as per advice to be provided by their legal advisors in Ireland, including the issuing of a notification to the relevant government minister.

88.              The Labour Court also had regard to the letter sent to the employees by Mr Bebbington , a member of the Board of Directors, on 9 April 2020. That letter informed them of the events that had transpired and the intention of the company to make application to the High Court to have a provisional liquidator appointed to the company. While the letter did not specifically refer to redundancies, it is clear from the tenor of that letter that redundancies would follow as a matter of course as part of the liquidation process.

89.              I am satisfied that this finding of the Labour Court cannot be set aside as having been made without evidence, or as being irrational in the legal sense.

90.              The Labour Court was entitled to make the finding that as and from 9 April 2020, the Board of Directors were compelled to consider making collective redundancies. Having regard to the decisions in Akavan , Tangney and JLOG , the obligation to commence consultations arose on that date. Accordingly, the court dismisses the appeal against this finding made by the Labour Court.

91.              The second finding that is challenged is the finding by the Labour Court that the consultations only commenced on 17 April 2020 when the first consultative meeting was held between the provisional liquidators, the Board of Directors and the workers' representatives. The rationale for that finding is based primarily on statements made to that effect by the provisional liquidators in correspondence that issued by them later in April 2020.

92.              I accept the submission made by Ms Smith SC that the Labour Court has erred in its interpretation of what is required by consultations under the Directive and the 1977 Act. When one reads ss. 9 and 10 of the 1977 Act together, it is clear that the provision of information concerning the proposed collective redundancies is an integral part of the consultation process. Section 10 clearly provides that for the purposes of consultations under s.9, the employer must supply certain information that is specified in that section.

93.              While it is correct to say that the holding of consultations cannot be delayed until all relevant information has been supplied by the employer, it is equally clear that consultations have to be meaningful (see opinion of Advocate General Sharpston in the JLOG case at paras. 43 and 44). To that end, the provision of basic information concerning the proposed redundancies is an essential part of the consultation process. It takes place in advance of the first consultative meeting so that that meeting may be productive.

94.              It is also necessary that information on the proposed collective redundancies be provided to the workers' representatives in advance of the meeting to allow them time to consider the extent of the proposed redundancies and to formulate proposals for measures, such as redeployment or retraining of employees, that might mitigate the effect of the proposed collective redundancies.

95.              In the present case, I find that the letter sent by email from Ms O'Connor to Mr Light on 14 April 2020 constituted the start of the consultation process. While the word "consultation" was not used in that letter, it was clearly stated at the start of the letter, that the information was being supplied in accordance with s. 1 0 of the 1977 Act. The letter went on to give all the information that was required under s.10 of the Act. In particular, it indicated that all employee roles within the company were being proposed for redundancy. This was critical information which the workers' representatives had to have in advance of having any meaningful consultation meeting with the liquidators or the Board of Directors.

96.              While perhaps not of enormous weight, it is noteworthy that in their written submissions made in advance of the Labour Court hearing, the respondent accepted that the appellant had purported to start a process of consultation pursuant to ss. 9 and 10 of the 1977 Act on 14 April 2020 (see paras. 73 and 74 of their submissions).

97.              The reliance of the Labour Court on the statements made by the provisional liquidators as to the start of consultations on 17 April 2020 is misplaced. Those were statements made by the provisional liquidators in correspondence in a completely different context. The meeting on 17 April 2020 represented their first engagement with the workers, because they were only appointed on 16 April 2020. It cannot be held that statements made by a provisional liquidator for one purpose in correspondence, can be equated with the statement as to a nuanced legal position which may be made by a lawyer.

98.              The Directive and the Act do not state that a consultative meeting represents the start of the consultation process required under their provisions. I hold that the consultation process required under the Directive and under the 1977 Act, is a process that can start in advance of the first consultative meeting by the provision of the information on the proposed collective redundancies as required by s.10 of the 1977 Act. In these circumstances, I hold that as a matter of law, the consultation process began with the sending of information by letter by Ms O'Connor to Mr Light on 14 April 2020.

99.              Accordingly, I hold that the Labour Court erred in law in finding that the consultation process, as required under s.9 of the 1977 Act, commenced with the holding of the meeting on 17 April 2020.

100.          The third ground of challenge to the decision of the Labour Court concerned the finding by the Labour Court that the delay from 9 April 2020 to 17 April 2020 meant that certain unidentified options were no longer available due to the appointment of provisional liquidators in the interim.

101.          Mr Kirwan SC quite correctly conceded that there was no evidence before the Labour Court of any options having been lost or becoming otherwise unavailable due to any delay between 9 April 2020 and the holding of the first consultative meeting on 17 April 2020. As this finding was made by the Labour Court without evidence, it cannot stand.

102.          Finally, there is the challenge to the award of compensation. The adjudicating officer and the Labour Court are given the power to award compensation to employees under section under s.11A(c) of the 1977 Act of such amount as they deem to be just and equitable having regard to all the circumstances, when there has been a failure by the employer to comply with its consultation obligations under ss. 9 and 10 of the Act.

103.          However, this award of compensation is not the imposition of a penalty against the employer. The Labour Court has no such jurisdiction under the 1977 Act.

104.          In the present case, there was no evidence that the respondent had lost any pecuniary benefit, or suffered any financial loss, because of any delay on the part of the appellant in commencing consultations with the union representatives. While compensation is not limited to compensation for financial loss, it must be referrable to some form of loss or injury suffered by the person being compensated. There was no evidence before the Labour Court that the respondent had suffered additional distress due to any perceived delay on the part of the appellant in commencing consultations with the respondent's union representatives.

105.          When looking at this issue, one must look at the reality on the ground, as of 8 April 2020, when the appellant was informed that funding would no longer be provided to it by the parent company. From that moment onwards, the appellant was hopelessly insolvent. It had very few assets. It had massive debts. This was all set out extensively in the petition papers lodged in the High Court for the purpose of the appointment of the provisional liquidators.

106.          In these circumstances, if the Board of Directors had allowed the company to continue trading, they would have been guilty of fraudulent trading, or at the very least, of reckless trading.

107.          If they had tried to make any payments to the employees prior to the appointment of the provisional liquidators, or to make any beneficial deals with them, these payments and deals would have been struck down by the High Court as unfair preferences pursuant to ss. 604 and 608 of the Companies Act 2014, as amended. In short, the letter of 8 April 2020 was devastating for all concerned with the appellant company, and in particular, for its employees; unfortunately there was nothing that the Board of Directors could have done to help them.

108.          I hold as a matter of law that there was no loss suffered by the respondent in the delay by the appellant in commencing the consultation process between 9 April 2020 and 14 April 2020. Accordingly, I hold that the Labour Court erred as a matter of law in awarding compensation to the respondent.

Proposed Order.

109.          In light of the findings of the court, it is proposed that the final order should allow the appellant's appeal against the decision of the Labour Court bearing reference PED 241, dated 10 April 2024.

110.          The court will hear the parties on the terms of the final order and on such consequential orders as may be appropriate.

111.          As this judgment is being delivered electronically, the parties shall have two weeks within which to furnish brief written submissions on the terms of the final order and on costs and on any other matters that may arise.

112.          The matter will be listed for mention at 10.30 hours on 26 March 2025 for the purpose of making final orders.