Renfrewshire Council v Educational Institute of Scotland

For collective consultation purposes, an establishment is the unit to which employees are actually assigned to perform their duties. The inquiry is primarily employee-focused and factual. Physical location and the existence of a distinct local organisation are important, whereas central powers over recruitment, deployment, discipline and dismissal do not ordinarily prevent a smaller unit from being an establishment.

A contractual mobility clause is not determinative. The relevant question is where the employee in fact works for more than a purely temporary or transitory period. The tribunal must consider whether the proposed unit is capable of being an establishment and whether the employee is assigned to it. If more than one unit qualifies, the policy of securing consultation rights may assist the choice.

Teachers employed by Renfrewshire Council claimed that the Council had failed to comply with the collective consultation obligation in section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992.

At a preliminary hearing, the Employment Judge held that the relevant establishment was the Council’s Education and Leisure Service, rather than the individual schools or all schools collectively. The Council appealed, arguing that the tribunal had adopted an erroneous approach, including reliance on the Employment Appeal Tribunal’s decision in Wilkinson v City of Edinburgh Council, which had subsequently been reversed by the Inner House.

The central issue was the proper approach to identifying the establishment to which the teachers were assigned to carry out their duties.

1. Appeal allowed. The Employment Judge had asked the correct initial question, but the reasoning leading to the answer was flawed. The finding that a school was not a distinct entity was perverse. It was obvious that a school could constitute a distinct unit, although that did not determine whether it was the relevant establishment for these employees.
2. “Assignment” referred to the factual, not merely contractual, position. A mobility clause did not determine the establishment. Where a worker actually worked at, in or from a unit for more than a purely temporary or transitory period, that was strong evidence of assignment to it.
3. The relevant statutory concept was informed by the European authorities on Article 1(1)(a) of Council Directive 98/59/EC. Rockfon A/S v Specialarbejderforbundet i Danmark established that an establishment was, depending on the circumstances, the unit to which redundant workers were assigned to perform their duties. Independent power to effect collective redundancies was unnecessary. Athinaïki Chartopiia AE v Panagiotidis added that the unit might be a distinct entity with a degree of permanence and stability, assigned tasks, a workforce, technical means and an organisational structure.
4. Central control over recruitment, allocation, movement, funding and dismissal was not decisive. Such control was normal where an employer operated through several establishments. The tribunal had wrongly treated the Council’s central powers as critical and had failed to focus on actual assignment and location.
5. The tribunal’s fact-sensitive conclusion could not be substituted because material findings were missing. The case was remitted to the same Employment Judge for reconsideration on further or fresh evidence, particularly concerning the individual teachers, any peripatetic or clustered arrangements, and the nature of the Education and Leisure Service.

• Employment Tribunal: held that the Education and Leisure Service of Renfrewshire Council was the relevant establishment for section 188 purposes.
• Employment Appeal Tribunal: allowed the Council’s appeal and remitted the case to the same Employment Judge for reconsideration.