Collective redundancies directive also applies in the event of the employer’s retirement

At a glance

• The European Court of Justice (ECJ) has held that the EU directive on collective redundancies (Directive) does apply in the event of an individual employer's retirement.
• The Spanish provision, according to which the consultation procedure is not required in the event of collective redundancies where the terminations are the result of a natural person employer’s retirement, is contrary to the Directive. 

On 11 July 2024, the ECJ handled a request for a preliminary ruling concerning the consultation procedure for collective redundancies. According to Spanish legislation, the requirement to consult employee representatives in the event of a collective redundancies does not apply when job terminations occur due to the retirement of an individual employer.

However, the ECJ has held that the Directive does apply in the event of an individual employer's retirement. It said that such an employer, who contemplates terminations in the light of their retirement, is capable of conducting consultation to avoid those terminations, or to reduce their number or, in any event, to mitigate their consequences. Therefore, the ECJ found that Spanish law is contrary to the Directive.