Where U.S. government closed military base on English
soil that would cause dismissal of 200 local employees without prior
consultation with their representative workers' organization as to reasons for
closing, United Kingdom Employment Appeals Tribunal rules that U.S. had
breached U.K.'s Trade Union and Labour Relations (Consolidation) Act 1992
Plaintiff Mrs. S. Nolan was working at a U.S. Army Base at
Hythe Hampshire (the Base). The Base was repairing watercraft and other
equipment. The U.S. army referred to the Base as a Reserved Storage Activity
(RSA). It employed 200 local civilians whom the LNEC represented. They were all
to be laid off.
Since at least early 2004, the U.S. government (Defendant)
had been considering whether to close the Base. After a 2006 audit report, it
became clear that Defendant had already decided to terminate operations there.
The U.S. Secretary of the Army decided to close the Base and the U.S. Secretary
of Defense approved his choice.
As it was obliged to do, on May 9, 2006, the Defendant
notified the U.K. Ministry of Defence that Defendant was terminating operations
at the Base and that the Defendant's facilities at Hythe would revert to the
U.K. on September 30, 2006.
Plaintiff brought proceedings against the Defendant in an
English Employment Tribunal (ET). She claimed that Defendant had breached its
obligations under Section 188 of the Trade Union and Labour Relations
(Consolidation) Act 1992 (TULRCA) to timely consult the Local National
Executive Council (LNEC) about the proposed layoffs of about 200 civilian staff
whom it represented.
The hearing on liability took place on June 11, 2007 and the
ET entered judgment on February 6, 2008. It ruled that the Defendant had
violated its obligations to consult in accordance with Section 188.
The ET held that: (1) that Consultation did not begin until
June 5, 2006; that there appeared to have been no impediment to starting the
consultation process right after Defendant had notified the U.K. Government on
May 9, 2006 that the Base was to close; that in fact the date of notification
to Her Majesty's Government (HMG) fell a substantial time after the Defendant
had determined to close its RSA base; (2) that the Defendant had failed to
consult staff representatives about the reasons for the Base closure and had
told LNEC that the RSA would close and that there could be no consultation on
that subject. The ET ruled against the Defendant, who appealed the decision to
the Employment Appeal Tribunal (EAT). At no time did Defendant claim sovereign
immunity under either U.S. or U.K. law [i.e. the State Immunity Act].
The Defendant stated that the appeal gives rise to the
following principal international issue: whether the ET erred in law in holding
that a foreign sovereign government has an obligation, in advance of a decision
to close a military base, to consult with, and provide information to, the
local civilian workforce about the reasons for its closure. The Employment
Appeal Tribunal ultimately dismissed Defendant's appeal.
In doing so, the Employment Appeal Tribunal noted that "[w]ithout
disrespect to the sophisticated and imaginative arguments advanced by
[Defendant] in support of the proposition that Section 188 should be construed
in the light of the jus imperii nature of the decision, the reasons for which
the ET held that there should have been consultation with employee
representatives, we are not persuaded by them."
"... [T]he principle that underpins the doctrine of
state immunity both at common law and under customary international law is that
courts will not scrutinise or interfere with decisions that are jus imperii,
namely, that are of a sovereign nature. The principle thus affects the
jurisdiction of the courts to scrutinise or interfere with such decisions. No
authority or learned article was placed before us which establishes or even
suggests that the jus imperii nature of an act affects not the jurisdiction of
the courts in relation to that act but the construction of a statute or
approach to a rule of law of which is engaged by that act." [76,
77]."The absurdity relied upon by [Defendant] in its construction argument
is the prospect of a failure by a foreign state to consult about reasons for
the closure of a military base being made the subject of scrutiny by an ET in a
claim for breach of Section 188."
"We agree that consultation with employee
representatives in advance of a decision to close a military base would be
likely to give rise to justified concern about security. Further, we accept
that a requirement to consult 'with a view to reaching agreement on reasons for
closure would sit uneasily with decision making at the highest level of a
foreign government and which engages high level military, political and
economic considerations."
"Further it may have been possible for the [Defendant]
to establish a defence under Section 188(7) that there were special
circumstances rendering compliance with Section 188(2)(a) not reasonably
practicable. The [Defendant, however], having submitted to the jurisdiction of
the ET did not avail itself of the statutory defence."
"A construction of Section 188 to impose no requirement
for consultation with employee representatives about the reasons for a jus
imperii decision is not necessary in order to avoid absurdity. Any absurdity
involved in subjecting such a decision to scrutiny in the ET could have been
avoided by claiming state immunity. The law of state immunity applies alongside
all other domestic statutes including employment legislation. The U.K. State
Immunity Act (SIA) and the common law of state immunity exist alongside TULRC.
... [A] special construction of Section 188 is not necessary to avoid the
absurdity of a jus imperii decision being subject to scrutiny in the ET. The
U.S. had two 'escape routes' available to it. It chose not to use them."
". . .[T]he Council Directive 98/59 provides a
floor not a ceiling of rights. The U.K.
has chosen to implement the Directive by not excluding from the right to be
consulted on redundancy, representatives of workers employed by public
administrative bodies or by establishments governed by public law referred to
in Article 1(2)(b). Indeed many of the cases on Section 188 have been brought
by unions representing workers in public authorities. The inclusion of such
workers within the scope of the domestic legislation illustrates that Section
188 cannot be said to be confined to consultation of the reasons for commercial
decisions leading to the closure of a workplace."
"In our judgment, the domestic statutory framework does
not require or permit a restrictive construction of Section 188 in
circumstances where redundancies result from a jus imperii decision. The fact
that there is express provision for the exemption of Crown employees from the
scope of Section 188 illustrates that, but for such a provision, redundancy
decisions relating to such employees would be subject to its provisions."
"There was no suggestion in [the precedents] that there
could be different constructions of the statute considered in that case
depending upon the status of the body or the quality of act subject to a rating
system which was the subject of the litigation. In our judgment, there is no
principle of law which would require or permit a different construction of a
statute to be adopted in a case where it was to be applied to an act engaging
jus imperii from that which was of general application. No authority was
brought to our attention which suggested otherwise."
"In U.K. Coal Mining, [2008] I.C.R. 163, the EAT
considered the nature and extent of the obligation imposed by Section 188(2)(a)
to consult about ways of avoiding dismissals. The EAT . . . held at page 184
paragraph 87: 'But the obligation to consult over avoiding the proposed
redundancies inevitably involves engaging with the reasons for the dismissals,
and that in turn requires consultation over the reasons for the closure."
"Strictly, of course, it is the proposed dismissals
that are the subject of consultation, and not the closure itself. Accordingly,
if an employer planned a closure but believed that redundancies would
nonetheless be avoided, there would be no need to consult over the closure
decision itself, at least not pursuant to the obligations under the 1992 Act.
In the context of a closure, that is likely to be a very exceptional case.
Where closure and dismissals are inextricably interlinked, the duty to consult
over the reasons arises.'"
"[Defendant] did not suggest that U.K. Coal was wrongly
decided although [Defendant] sought to distinguish it on the basis that it
applies to commercial decisions not to
decisions which involve public policy. We do not agree that such a distinction
can be drawn. There is no warrant in Section 188 for drawing such a
distinction: the obligation to consult applies to both public sector and
private sector employees. Redundancies in the public sector may well result
from decisions taken for political and other non commercial reasons. These
reasons are not excluded from the consultation requirements of Section
188."
"The fact that there was reference to consultation over
economic decisions in the Information and Consultation of Employees Regulations
2004 in U.K. Coal as support for a conclusion that Section 188 imposes an
obligation in certain circumstances to consult over the reason for a decision
which will lead to redundancies does not restrict the application of the
interpretation of Section 188 in that case to decisions taken for economic
reasons.
"The effect of the judgment in U.K. Coal is that the
statutory obligation to consult about ways of avoiding dismissals in
circumstances of the closure of a workplace is to be construed as including the
obligation to consult about the reasons for the closure. ..." [ 79‑90]. In
our judgment, the ET did not err in holding that the U.S., having submitted to
the jurisdiction of the ET was in breach of its obligation to consult with
employee representatives about the reasons for the closure of the Base." [
91]
Citation: United States v. Nolan, 2009 WL 1321758
(EAT); (2009) 153 S.J.L.B. 32 (Emp. App. Trib. May 15, 2009).
*** Mr. Kenneth Todd Wallace is an attorney and founding partner of the law firm. He has nearly 20 years of experience in the legal and business professions with established excellence in trial advocacy, negotiation, strategic and initiative planning, government relations, mergers and acquisitions, and team building. See http://www.walmey.com/
