Decision

Decision

Updated 2 December 2020

Case Number EWC/0029/2020

2 December 2020

CENTRAL ARBITRATION COMMITTEE

TRANSNATIONAL INFORMATION AND CONSULTATION OF EMPLOYEES REGULATIONS 1999 (AS AMENDED)

DECISION ON COMPLAINT UNDER REGULATION 21

Parties

HP Inc European Works Council

and

The Central Management of HP Inc

1. Introduction

1) On 12 June 2020 Mr P Sack, Director, EWC Legal Advisers, on behalf of the HP Inc European Works Council (the EWC), presented this complaint to the Central Arbitration Committee (the CAC) under regulation 21 of the Transnational Information and Consultation of Employees Regulations 1999 (as amended) (TICE).

2) The complaint alleged a failure by the Central Management of HP Inc (the employer) to comply with regulation 18A and paragraph 8 of the schedule to TICE regarding a proposal to make 350 job cuts in the European Economic Area.

3) Specifically, the complaint alleged that the employer:

(a) failed to provide sufficient information, or to consult, about the proposed job cuts to enable the EWC to undertake a detailed assessment of possible impact, and to express an opinion on the basis of the information provided to it, in breach of regulation 18A; and

(b) failed to hold a valid exceptional information and consultation meeting in accordance with paragraph 8, the meeting which did take place on 7 May 2020 being non-compliant because the employer failed to provide the required information.

4) As required by section 263 of the Trade Union and Labour Relations (Consolidation) Act 1992, the CAC Chair appointed a panel to deal with the case. The panel consisted of Mr S Robertson, Panel Chair, and Ms S Jordan and Ms F Wilson, Panel Members. The Case Manager appointed to support the panel was Mr N Cookson and for the purposes of this decision, Miss S Khan.

5) The EWC, represented throughout by Mr Sack, provided the following documents to the CAC in support of the complaint:

(a) its initial letter of complaint dated 12 June 2020 (1-2);

(b) its reply to the employer’s response to the complaint, dated 23 June 2020 (4-10);

(c) its detailed Statement of Case dated 23 July 2020 (19-42);

(d) its Final Submission dated 21 August 2020 (57-62); and

(e) its Final Outline Submission dated 20 October 2020, prepared for the hearing of the complaint on 5 November 2020.

6) The employer, represented throughout by Mr D Hopper of Lewis Silkin solicitors, provided the following documents to the CAC in response to the complaint:

(a) its brief initial response, dated 17 June 2020 (3);

(b) its fuller response of 30 June 2020 (11-18);

(c) its detailed Statement of Case dated 23 July 2020 (43-56);

(d) its Final Submission dated 21 August 2020 (63-64); and

(e) its further Final Submission dated 20 October 2020, prepared for the hearing of the complaint on 5 November 2020.

7) The panel held a formal hearing of the case on 5 November 2020 by Zoom videoconference, at which Mr Sack represented the EWC and Mr Hopper the employer. The panel heard evidence from Mr B Gastmans, Chair of the EWC, Ms S Ellerker, the employer’s Global Head of HR, Marketing, Finance and Communications, and Mr O Abello, the employer’s Labour Relations Lead, European Markets and ISE. The parties provided for the hearing an agreed file of submissions, correspondence, evidence and authorities. The panel considered material from the agreed file when referred to it by the parties. References in this decision to page numbers are to this file.

2. TICE

8) It is convenient to set out the material provisions of TICE at the beginning of this decision.

9) TICE transposes into the law of the United Kingdom the provisions of the Recast European Directive 2009/39/EC about European Works Councils.

10) Regulation 18A(2) requires an employer’s central management, or any more appropriate level of management, to give information to members of a European Works Council (an EWC)and, by regulation 18A(3):

“(3) The content of the information, the time when, and the manner in which it is given, must be such as to enable the recipients to

(a) acquaint themselves with and examine its subject matter;

(b) undertake a detailed assessment of its possible impact; and

(c) where appropriate, prepare for consultation.”

11) Regulation 18A(4) requires central management to consult with members of an EWC in accordance with paragraph (5), which is in the following terms:

“(5) The content of the consultation, the time when, and manner in which it takes place, must be such as to enable a European Works Council … to express an opinion on the basis of the information provided to them.”

12) The schedule contains default Subsidiary Requirements (SRs) which apply where no agreement exists between the EWC and the employer governing the relationship between them.

13) Paragraphs 6 to 8 of the schedule concern information and consultation meetings between central management and an EWC.

14) Paragraph 6 states that:

“(1) The competence of the European Works Council shall be limited to information and consultation on the matters which concern the Community-wide undertaking or Community-scale group of undertakings as a whole or at least two at least of its establishments situated in different Member States.”

15) Paragraph 7 provides for an information and consultation meeting between management and the EWC once a year, on the basis of a report drawn up by management, on matters concerning the progress of the business of the Community-wide undertaking or Community-scale group of undertakings and its prospects.

16) Paragraph 8 governs exceptional information and consultation meetings. This case concerns such a meeting. It provides:

“(1) Where there are exceptional circumstances affecting the employees’ interests to a considerable extent particularly in the event of relocations, the closure of establishments or undertakings or collective redundancies, the … European Works Council shall have the right to be informed. It shall have the right to meet in an information and consultation meeting, at its request, the central management, or any other more appropriate level of management….so as to be informed and consulted.

…

(3) The exceptional information and consultation meeting…. shall take place as soon as possible on the basis of a report drawn up by the central management, or any other more appropriate level of management…on which an opinion may be delivered at the end of the meeting or within a reasonable time.

(4) The exceptional information and consultation meeting shall not affect the prerogatives of the central management. “

3. Facts

17) The relevant facts are as follows. They derive from information provided by the parties, the panel’s consideration of the contemporaneous documents, and the evidence given by Ms Ellerker and Mr Abello.

18) The employer, HP Inc, is a USA-headquartered multinational information technology company. It operates in the European Union and the European Economic Area through undertakings in several Member States, forming part of its European Group.

19) The employer designated its UK subsidiary, HP Inc UK Limited, for employee information and consultation as required by the Recast Directive, thus applying the provisions of TICE. Effective 1 November 2020, it has ended HP Inc UK’s designation and appointed HP Technology Ireland Limited as its representative agent, but accepts at paragraph 5(1) of its further Final Submissions dated 20 October 2020 that this does not preclude the EWC pursuing this complaint, or the CAC deciding upon the complaint. Similarly, the parties agree that the United Kingdom’s position within the Transition Period following its exit from the European Union on 31 January 2020 has no jurisdictional significance for this complaint.

20) The HP Inc European Works Council (the EWC) was at all material times established and operated under the SRs as set out in the schedule to TICE.

21) In October 2019 the employer made an announcement (the 2019 SAM)^{[footnote 1]} to the US Securities and Exchange Commission about a three-year business transformation process to save $1 billion which might impact on 7,000 to 9,000 of its employees worldwide (65-86). It briefed the Select Committee of the EWC confidentially ahead of the announcement. It provided a summary to all employees (87-89), repeating the possible effect on jobs worldwide. It undertook to the Select Committee on 23 and 25 October 2019 (90-101) to provide further information about any proposed measures connected to the 2019 SAM that might affect employees’ interests in the EU/EEA as soon as it had details.

22) The paragraph 7 annual meeting between management and the EWC took place in December 2019 but no information was given about EU/EEA impact of the 2019 SAM.

23) In January 2020 management arranged an exceptional information and consultation meeting with the EWC on 30 January 2020 concerning proposals with the designation “OD&S”. These apparently involved about 125 job cuts, but the panel has not heard any evidence about them. However, shortly before this meeting, on 24 January 2020, Sharon Ellerker, the employer’s Global Head of HR, Marketing, Finance and Communications, wrote to the EWC (116-117) about the separate measures which are now the subject-matter of this case.

24) In the email Ms Ellerker referred to the commitment given in October 2019, and advised that management now knew of proposals being formulated that might involve a reduction in the number of employees in the EU/EEA by 350 in FY20. ^{[footnote 2]} This reduction, she said, was in addition to any reduction that might result from the OD&S proposals already under consultation. She said that management had no further information than what had already been made available to employees about SAM 2019, but” unambiguously” committed to informing the EWC if and when management received any more information.

25) Ms Ellerker suggested that it would be premature to hold an exceptional information and consultation meeting at that point, because management would be unable to provide the kind of detailed information required under regulation 18A, but said management would be willing to invite all members of the EWC if they requested a meeting. She invited views on how to proceed, whilst reiterating that management could not provide information it did not have.

26) On 27 January 2020 Mr Gastmans, Chair of the EWC, asked to proceed with the OD&S meeting on 30 January 2020 with the information they had, and said the EWC would “come back on” the additional information given by Ms Ellerker on 24 January 2020 (116).

27) The parties briefly discussed the 350 job cuts at the meeting on 30 January 2020. Mr Gastmans advised that the EWC would want an exceptional meeting and requested timing for the meeting and the management report on which it would be based. Management agreed to consider this. No timescale was agreed.

28) Several weeks later, on 17 April 2020, Oriol Abello, Labour Relations Lead European Markets, wrote to the EWC (127) about the 350 proposed job cuts, asking if it now wanted the exceptional meeting as previously indicated:

“Dear members of the EWC,

….

I am now following up on Sharon’s email below ^{[footnote 3]} about proposals being formulated that might involve a reduction in the number of employees in the EU/EEA by up to 350 in FY20. You will recall that we also spoke about this in Barcelona on 30 January 2020 and agreed that we in management would come back to you on this.

We in management are now able to provide you with the following: (i) an updated estimated number; (ii) additional information on the potential impact on employees per geographical market; and (iii) additional information on the potential impact on employees per business (L1) ^{[footnote 4]}. This development means that “exceptional circumstances affecting the employees’ interests to a considerable extent” now exist (as such phrase is used in paragraph 8(1) of the schedule to TICE).

Please would you let me know by noon on 21 April 2020 if you now request an exceptional information and consultation meeting as you suggested that you would? If I do not hear from you by this deadline then we in management will proceed on the basis that you do not wish to request a meeting. If you do request a meeting by the deadline then we will provide proposals on the arrangements and timeframes for it and our management report (including the above information) on which it will be based.”

29) Mr Gastmans replied on 21 April 2020 that the EWC requested such a meeting (126-127). He set out the EWC’s expectations and assumptions ahead of and for the meeting:

• a management information package would be provided at least 15 days before the actual meeting

• it was assumed that the proposals were part of the Transformation Project and number announced at the 2019 SAM meeting

• the possible total impact should be shown by function and country as being part of the establishments or undertakings “directly concerned”

• detailed insights should be given of the current and future market situation in areas which the EWC represented and any possible additional impact on top of the 350-employee reduction in FY20

• the EWC might formulate other questions following the management information package

• the meeting should be held in two stages: an information meeting with management and all EWC members, attended (as observer) by the EWC’s expert, and a consultation meeting with management and all EWC members.

30) Mr Abello replied on 22 April 2020 (125-126). He did not accept some of the EWC’s proposals: in particular, the management report would be provided 0n 23 April 2020, 14 (not 15) days before the meeting, which would be on 7 May 2020; the meeting would not be in two stages; and the EWC’s expert would not be permitted to attend, although the EWC could copy the management report to its expert beforehand.

31) The employer provided its management report to the EWC on 23 April 2020. The report was in two parts: (1) non-confidential and (2) confidential (as permitted by regulation 23 of TICE).

32) The report consisted of 18 presentation slides (129-137). After cover and agenda slides, there was a single “timeline to now” slide followed by 12 slides from the 2019 SAM presentation (which members of the EWC had already seen), and finally two confidential slides specifically about the proposals (reproduced on one page in the hearing file (137)).

33) The first confidential slide was entitled “Summary of proposed exits”: it gave the total EU/EEA employee population of 9,350, total number of proposed exits: 349, numbers of proposed exits by market: Northern Europe 47, Southern Europe 72, Central Europe 194 and UK & Ireland 36, and numbers by L1 business: 3D Print 12, Commercial Organisation 123, Supply Chain 48, Finance 16, Marketing 32, Print 70, Communications 1, CTO 4, Customer Support 39 and Global IT 4. The second confidential slide gave a proposed timeline, showing exits from June to October 2020. Neither slide gave any narrative supporting the information.

34) Each market referred to, Northern Europe, Southern Europe, Central Europe and UK & Ireland, comprised of undertakings in at least two separate countries within the EU/EEA. The identified L1 businesses also operated across Europe.

35) Mr Gastmans acknowledged receipt of the report on 23 April 2020. He said that the EWC might request further information by 28 April 2020, with an expected management response by 4 May 2020, and might request more information after the response on 4 May 2020 (138).

36) Mr Gastmans requested further information by email on 28 April 2020, which the panel sets out verbatim (141):

“Thank you for providing us with the management report on 23/04/2020.

If you want to inform us on at an exceptional circumstance information meeting, we need to be able to understand the possible impact.

The provided info on market and L1 level is appreciated, but far from usable.

We do need to have:

• For the markets we represent, what are the expected savings, what are the expected restructuring and redundancy costs.

• How are the numbers calculated, how the numbers been arrived at.

• What are the individual ratios as part of other markets (ex 123 in CO represents 50% of WW impact in CO organization)

• Impact by L1 in each region (ex 10 in mkt for NE) - Impact by country (ex NL 25 in total) - What type of roles are you talking about (ex in mktg – EU marketing, Campaign design, Online…)

• What does this mean in terms of workload transfer, and whom, where will it be taken and how will it be measured

• What does it mean in terms of estimated sales and customer impact - When, how and what will the local consultation process and communication process be per country?

• From the 7000-9000 announced, we have had been notified about 123 roles in L5-L9 at the Exceptional meeting on 30 Jan 2020. Where is HP in its transformation project YTD?

• Feedback on the Rollout of the new structures and R&R’s

• Status of current total number of employment impact YTD in our countries (per country) following Transformation from L1 to L9 level

• Current business update with numbers:

• During the annual meeting we have requested a view on FY20 quota’s for EMEA (and for the new organisation by Market). Again not having received it, proves that HP is withholding basic information to the EWC

• Could we have an estimation of the immediate impact of the Covid19 crisis on the business in EU and the possible development in the future?

This would not limit the need for any possible addition information later on.”

37) On 4 May 2020 Mr Abello replied that management was still compiling the answers which would be provided “as soon as we can tomorrow”. In response, Mr Gastmans asked for the information by noon on 6 May 2020 as the EWC would need to do some work on it before the meeting the next day (147).

38) Management provided its response just before noon on 6 May 2020, stating that it covered all the questions asked by the EWC on 28 April 2020 (148-151). Again, the panel reproduces it verbatim:

Questions and Answers on Management’s Report for the Exceptional I&C Meeting on 7th May 2020

Question- Email from the EWC 28.04.2020	Response
1. For the markets we represent, what are the expected savings, what are the expected restructuring and redundancy costs.	We in management expect that the gross annualized run rate savings from the ~350 FY20 proposals in the EU/EEA countries would be approximately $36M. As regards redundancy costs, we in management are unable to provide precise figures in addition to the significant amount of information that we have already provided to you on our rationale. This reflects that providing this information would not involve the collation of reasonably easily available information as any national information and consultation processes will involve consultation on a country by country basis not only on how to avoid redundancies but also how to mitigate the impact of any redundancies that are ultimately not avoided.
2. How are the numbers calculated, how the numbers been arrived at.	We in management have estimated the information above on expected savings using HP average salary structures across countries.
3. What are the individual ratios as part of other markets (ex 123 in CO represents 50% of WW impact in CO organization)	The ~350 FY20 proposals in the EU/EEA countries would represent approximately 4% of the HP badged headcount in them as of end of April 2020. The EWC’s role is to be informed and consulted on transnational matters having regard to your EU/EEA-level remit. We in management will therefore not be providing information of a regional/market nature.
4. Impact by L1 in each region (ex 10 in mkt for NE)	The EWC’s role is to be informed and consulted on transnational matters having regard to your EU/EEA-level remit. We in management will therefore not be providing information of a national nature.
5. Impact by country (ex NL 25 in total).	The EWC’s role is to be informed and consulted on transnational matters having regard to your EU/EEA-level remit. We in management will therefore not be providing information of a national nature.
6. What type of roles are you talking about (ex in mktg – EU marketing, Campaign design, Online…).	As we have identified in our Management Report, any potential impact could be across any of our businesses and organisations.
7. What does this mean in terms of workload transfer, and whom, where will it be taken and how will it be measured.	Please refer HERE to page 17 of the minutes of our exceptional I&C meeting held in Barcelona on 30th January 2020.
8. What does it mean in terms of estimated sales and customer impact.	The proposed measures are neither intended nor anticipated to reduce sales or impact on customer service. They are instead proposed with a view to improving efficiency whilst maintaining standards.
9. When, how and what will the local consultation process and communication process be per country?	Any national information and consultation processes will take place in accordance with national law. We in management will be linking any such processes to this process so that they begin within a reasonable time of each other.
10. Form the 7000-9000 announced, we have had been notified about 123 roles in L5-L9 at the Exceptional meeting on 30 Jan 2020 Where is HP in its transformation project YTD?	Please refer to the All Employees email that you have each already received that was sent by our CEO, Enrique Lores, on 30th April 2020. In particular, please refer to these two paragraphs and the Reinventing HP section: • We will resume our focus on the cost management plan we shared last year. We announced in March that we would defer any previously planned workforce reductions (WFRs) through the end of May.That pause was intended as a temporary measure as we faced the COVID-19 pandemic. Now that we are moving into the next phase of this crisis, we will need to reduce our costs and execute against our original plan. • That’s why we’ll be accelerating our transformation agenda in ways that both reduce our structural costs and enable us to become a digital-first, data-driven company. One of the lessons of this crisis is that we must become more agile and resilient, with systems, tools, and processes that make us smarter and faster in responding to rapidly changing market conditions.
11. Feedback on the Rollout of the new structures and R&R’s	Could you please clarify what you mean by “new structures and R&R’s”?
12. Status of current total number of employment impact YTD in our countries (per country).	Please see HERE for our number of employees as of 4th May 2020.
13. During the annual meeting we have requested a view on FY20 quota’s for EMEA (and for the new organisation by Market). Again not having received it, proves that HP is withholding basic information to the EWC.	Please refer HERE to pages 29 and 30 of the minutes of our Annual Meeting held in Barcelona on 15th and 16th January 2020.
14. Could we have an estimation of the immediate impact of the Covid19 crisis on the business in EU and the possible development in the future?	Please refer to the All Employees email that you have each already received that was sent by our CEO, Enrique Lores, on 30th April 2020. In particular, please refer to the sections: (i) Responding to the crisis; (ii) providing stability; (iii) Reinventing HP; and (iv) Emerging stronger and more resilient.

39) The EWC met later on 6 May 2020 to prepare for the meeting. It decided the information given was inadequate and provided too late for detailed assessment by the next day. Mr Gastmans requested by telephone and email a postponement of the meeting, detailing the considerable amount of information which the EWC still required, in terms which, although lengthy, the panel again reproduces verbatim (157-160):

“Thank you for your reply on May 6th 11:53h.

With the current situation of uncertainties, now more than ever, and given the paucity of information provided by management so far, we do not believe that the management report is a sufficient basis to conduct a proper information and consultation meeting and to give our opinion on the proposals. In full transparency and a spirit of cooperation with HP management we are asking to postpone the Exceptional circumstance meeting of May 7th 2020. (as per our phone conversation on May 6th 2020 at 17:35)

We do want to engage with trust and respect and we would like it to be from both sides.

We do still want an exceptional meeting to be held, and in order to hold the EC meeting, we want to have more in depth information to be provided upfront.

• For the markets we represent, what are the expected savings, what are the expected restructuring and redundancy costs.

• You have provided a figure for total gross annualized run rate savings from the ~350 FY20 proposals in the EU/EEA countries. - We would like a breakdown of savings resulting from the proposed 349 exits by business segment and by region, in the same way that employee numbers are presented in the slide entitled “Summary of proposed exits”.

• As regards restructuring and redundancy costs, your reply only refers to redundancy costs, and states that the information is not reasonably easily available. Please could you provide information on other restructuring costs, apart from redundancy costs, also broken down by business segment and by region.

• We would also like this information on savings and costs broken down by individual country, and we believe we are entitled to this information at that level. We acknowledge however that you disagree and that you will not provide it to us.

• How are the numbers calculated, how the numbers been arrived at.

• I guess you have misunderstood our request. We would like to know how the proposed number of exits by market and by business have been arrived at. For example, 194 in Central Europe, 123 in Commercial Organization. Please could you provide that information.

• What are the individual ratios as part of other markets (ex 123 in CO represents 50% of WW impact in CO organization).

• You gave a figure for the percentage that the proposed ~350 exits represents of the total EEA headcount, but that is not what we asked. We would like to know what percentage the proposed EEA exits represent out of the total number of worldwide proposed exits, broken down by business. For example, what percentage of worldwide proposed exits in Commercial Organization do the 123 proposed exits in the EEA represent? What percentage of worldwide proposed exits in Print do the 70 proposed exits in the EEA represent, etc?

• Impact by L1 in each region - We would like to know the number of proposed exits by business within each of the 4 regions in the EEA (Northern Europe, Southern Europe, Central Europe, UK & Ireland). (ex Central Europe: 86 in CO, 26 in supply chain …)

• You have declined to provide this information on the grounds that “The EWC’s role is to be informed and consulted on transnational matters having regard to your EU/EEA-level remit.” As you know, the definition within the TICE Regulations 1999 of what is “transnational” is that it concerns at least two undertakings or establishments situated in two different member states. Since each of the 4 European regions comprises undertakings or establishments in more than one member state (which during the Brexit transition period includes the UK), the information requested is “transnational”. We repeat our request to receive this information.

• Impact by country (ex NL 25 in total)

• As previously noted, we disagree on whether the EWC is entitled to receive this information.

• We are not looking at individual roles (employees) but also understand the possible impact on the different roles in a country

• What type of roles are you talking about (ex in mktg–roles in: EU marketing, Campaign design, Online…)

• You replied that any potential impact could be across any of our businesses and organisations. We can already see that from the information previously provided, but that is not the question we asked. We asked what types of role could be affected within each business and gave some possible examples. If you are not willing to provide this information, please could you explain why not.

• What does this mean in terms of workload transfer, and whom, where will it be taken and how will it be measured

• Your reply referred us to the minutes of the exceptional meeting on 30 January 2020. We would like to see also how it works today, any possible impact detected, any prevention methods which were not included in that report.

• What does it mean in terms of estimated sales and customer impact

• Your reply stated that the proposed measures are neither intended nor anticipated to reduce sales or impact on customer service. They are instead proposed with a view to improving efficiency whilst maintaining standards. We are not convinced that they will have no impact on sales or customer service. We have discussed this in length during the Annual meeting on 30 January 2020 with example of WiPRO where we do have proven sales and customer satisfaction impact. So we repeat our question.

• When, how and what will the local consultation process and communication process be per country ?

• Your reply simply stated that any national information and consultation processes will take place in accordance with national law and that those process and this transnational process will be linked so that they begin within a reasonable time of each other. That is simply a statement of the legal obligations on HP. In the report produced by management for the exceptional meeting on 30 January 2020, a timeline for local consultation about the 128 at-risk roles within each country was provided. Could you provide an equivalent timeline for the proposed 350 exits?

• Could you also inform us how consultation and communication will be carried out countries where there is no works council.

• From the 7000-9000 announced, we have had been notified about 123 roles in L5-L9 at the Exceptional meeting on 30 Jan 2020. Where is HP in its transformation project YTD?

• Your reply referred us to the email sent by Enrique Lores on 30 April 2020. His email does not answer the question we asked. Could you please inform us of the number of exits within the EEA that have taken place as part of the Transformation Agenda since it was announced in August 2019. This should include an update on the 128 at-risk roles referred to at the meeting on 30 January 2020, the 34 affected employees due to transfer to KPMG as referred to in Antonella Cecca’s email to the EWC dated 7 February 2020, and any other exits that have so far taken place.

• Are the previous announced number of 123 included in the 350? - The number of employees per country provided on March 2020 versus Jan 2020 don’t cover this insight. We have examples it does not.

• In Enrique’s email he said HP will be “accelerating our transformation agenda”. Please can provide information on what that means in terms of the situation and probable trend of employment within HP in the EEA.

• Feedback on the Rollout of the new structures and R&R’s

• We like to understand if the Roles and responsibilities have been cleared out now after the transformation project has been started as in the past some of the roles where grouped under the country, where now under for example a Center of excellence (and for example not reporting to the country) – ex like Marketing, category…

• Status of current total number of employment impact YTD in our countries (per country) following Transformation from L1 to L9 level

• As with previous (7000-9000) question, your reply with a number of employees per country provided on March 2020 versus Jan 2020 don’t cover this insight. We have examples it does not. (ex Belgium – 1 person)

• Current business update with numbers:

• During the annual meeting we have requested a view on FY20 quota’s for EMEA (and for the new organisation by Market). Again not having received it, proves that HP is withholding basic information to the EWC.

• You reply to refer to pages 29 and 30 of the minutes of our Annual Meeting held in Barcelona on 15th and 16th January 2020

• It’s not because you don’t have it, it doesn’t exist. We do have numbers in each country, so we should have it by region too. Therefor we are keen to see what the current results are of the business.

• Could we have an estimation of the immediate impact of the Covid19 crisis on the business in EU and the possible development in the future?

• In your reply you referred to Enrique Lores’ email of 30 April.

• This has no details with regards to business results, … possible additional impact on employment, methods of work, Market positioning … Could you please let us know when within the next week if/when you will be able to provide the further information we have requested, and could you also propose a new date for a rescheduled meeting.

As a final point, we would like to set on record our view that the proposed attendees for the meeting do not constitute the appropriate level of management having its own powers of decision as required by paragraph 8(1) of the Subsidiary Requirements to the TICE Regulations. For example, it is proposed that Helena Herrero should attend, but there is no equivalent management attendee from the other EEA regions.”

40) Mr Abello responded at 10am on 7 May 2020, declining to postpone the meeting (161):

“There is no “bright line” test for whether we in management have provided you with sufficient information and your view on this question is not determinative. We also recognise that our view is also not determinative. However, an EWC should not feel unable to fulfil its role without having access to the full range of information it considers it would need were it in our shoes as decision-maker. It is therefore appropriate for us to proceed with meeting today. This reflects that the information that we have provided to you enables you to understand our rationale for our proposals and the potential impact that they would have on affected employees”.

41) The meeting duly proceeded on 7 May 2020 (162-179). It was a lengthy full-day meeting – the minutes extend to 17 pages – conducted by videoconference. The salient matters discussed were, in summary, these:

(a) Management explained that the job cuts were part of the 2019 SAM process, the numbers given were the maximum number and were likely to fall following local consultation and by redeployment, as had happened with the OD&S process.

(b) Management asserted that it had provided its report and responded to the EWC’s request for additional information. It had declined the request for postponement of the meeting, believing the information given was sufficient and could be clarified at the meeting.

(c) The EWC contended that the information provided was not sufficient and not detailed enough, they had not received answers on all of the questions they had formulated which they needed answering to do a good assessment.

(d) Management asserted that they would always provide what was available relevant to the mandate of the EWC and if they had not provided information it was typically because they did not have it, or it was not available, or it was a level of detail that was relevant to country-level consultation.

(e) The EWC asked how the precise numbers had been arrived at, for example in the Central Region, they had no idea how they were constituted and asked how they could give an opinion without that information.

(f) Management said that the rationale was shared at the beginning and was part of transformation and cost reduction targets. It was what had been envisaged by the business to meet cost reduction targets and the detail of that had been consulted on at a country level.

(g) Management highlighted that the total impact of the number proposed was less than 4% of the total population. Within EEA countries the number was very limited. The EWC responded that 4% did not mean anything and they could not judge what the impact was. The EWC said that if the business was looking for cost savings, why not double the number and double the cost savings, where had the numbers come from.

(h) Management said it was a balanced approach. They did not want to reduce jobs if they did not need to, they had to be careful how they managed it and think about the balance of work, only take roles out where work stopped or there was a new automated way of doing it and not cut too hard on the people side. The EWC commented that if the priority was to protect people, reduce to zero but if cost, increase the number, but explain why.

(i) Management referred to what was described as the North Star slide, giving the balance and framework the businesses were using in how they achieved the associated cost reductions. The EWC said they wanted more granular data such as LI information. Management agreed to consider providing it, for the four markets.

(j) Management disagreed with the EWC’s request for country data and impact on sales, customers etc, saying that the EWC’s mandate was around employee impact, and they did not want to get into detail at a country level. The EWC asserted that country impact was part of the transactional impact: if say 39 job cuts was not just in one country, it was transnational by default, to which management responded that transnational was the whole project and they did not have the country breakdown.

(k) The EWC asked how management could consult without having the figures, knowing the impact, to which management replied that businesses were working on mitigating the impacts and actual numbers would be consulted locally.

(l) Management asked what the EWC wanted with a country and not market level view, to which the EWC responded it would look at the workload of people, understand and provide feedback on things or suggest things to reconsider with a cross-country view. They believed management had the information but were withholding it. Management responded that they believed they were complying with the SRs.

(m) The EWC contended that effectively the information package was one slide. Everything else was publicly available. Management responded that that did not mean it was not relevant. The EWC had asked for more information and management had agreed to take back the request to have more granularity by market by L1.

(n) Management said that the strategic command was to become more efficient in revenue and performance for what was FY20, then COVID came in and severely affected performance. They would see what information could be provided on effect by market.

(o) The EWC asked what types of roles were impacted within L1, in what way the business was changing its operations in the future. This was just for the L1 regions the EWC represented, what were the implications and the employer’s intention for functions on market and businesses and how businesses operated. Management responded that they understood and perhaps by L1 they could see how it affected by market but even with overall numbers they needed to know who was leaving, and it was difficult to answer.

(p) Management said the business was changing. There was no proposal to outsource jobs. The 350 were based on cost savings, the transformation plan was driving it and the $1bn cost savings wanted by FY22. As to other cost savings, there was the travel freeze, understanding different projects in every market and country and some flexibility, what could be done in online, in terms of people not on headcount and outsourcing services, several different actions, looking at the productivity ratio, how much revenue, gross margin.

(q) The EWC asked for thoughts on reducing costs, reduction of employees, investing in data and streamlining systems, adding another say 750 people onto the list instead of 350 e.g. closing distribution centres, closing offices. Management responded that everything was on the table, there were different workstreams analysing how the company could become more efficient. The EWC commented that within L1, the job cuts were in different areas and one possibility might be say to close a particular distribution centre which was a cost reduction as well as losing jobs, which was why country information was important when eg supply chain was impacted.

(r) Management gave an example on call centres, where they were analysing how many people, what data analytics they needed, their digital needs, working to build more consistency across processes. it was very important to standardise many of the processes no matter where the call centres were, delivering the customer experience for that market. The EWC commented that this was exactly the conversation they wanted to have, but they could only do that if given information, so asked the employer to look at the questions again and give as much as possible. This was the EWC’s role, to work with management and to have sustainable employment for the workers in Europe.

(s) Management said that the EWC and the company needed to understand the things necessary for the company to be sustainable, and this transformation needed to happen. They must work together to find a way to make it sustainable for the future. With COVID they needed to become stronger in a very different environment and understand both sides. Management wanted the EWC to understand and put the big picture together, as some markets were changing – was the company efficient enough, leaving space to go where the demand would be. Management reinforced that a lot of leaders were spending a lot of time looking at all eventualities and when decisions or proposals were made these were not made overnight but they spent days or weeks discussing them on how to balance the mix, transformation with the least disruption, dealing with people, not just employees but customers and partners too. The impact looking at Europe as a whole should not be lost in the details or country or market, but a project which had an impact across markets, not closing sites or moving work from one site to another.

(t) The EWC said that they had open questions, and invited management to look at them and decide if they had additional insights. Management responded that they did not have the L1 information but would look at it.

42) Further email traffic between Mr Gastmans and Mr Abello followed the meeting. Mr Gastmans repeated the request for information, Mr Abello refused it. Mr Abello noted that the EWC had declined to offer an opinion. On 5, 9 and 10 June 2020 the EWC requested again the information previously asked for, for example in the email of 5 June 2020 (182-183):

“We received your mail from Jun 5th 2020 with HP’s view, which we don’t agree upon.

1. We are disappointed that management will not be providing any of the information we requested.

2. It is the lack of adequate information that prevents the EWC from undertaking a detailed assessment of the possible impact and therefore from giving an opinion.

3. We would still like to receive the information about L1 businesses within each market referred to in your email of June 3rd 2020 though we do not believe it would be sufficient to enable the EWC to carry out a detailed assessment and provide an opinion.”

43) On 10 June 2020 Mr Abello responded (182):

“Thank you for confirming your position and that you will not be giving an opinion on the basis of the information that we have provided. I nevertheless wish to thank you all again for the constructive exchange of views and dialogue during our information and consultation meeting on 7 May 2020. These were useful for us in management and we have subsequently taken them into account during our decision-making process.”

44) There matters rested. The EWC declined to provide an opinion on the proposals discussed on 7 May 2020, citing inadequate information provided to it.

45) In evidence at the hearing on 5 November 2020, Ms Ellerker and Mr Abello gave more detail about the proposals. Ms Ellerker described the 349 job cuts as an aggregate forecast pulled together from information provided on a quarterly basis by the business groups for global financial and workforce planning purposes. She said there was no overall plan or single thread, it was an aggregate picture of information from the separate businesses on what was likely additional to OD&S and was dependant on business performance, market factors, budgets and managing costs. She said that the businesses would not have had concrete plans, only forecasts on a worst case scenario. She put it this way:

“It was for each leader of each business to ensure they aligned their businesses to the overall objectives of the Transformation Project. It was up to individual businesses to deliver their objectives …. People in the businesses will have produced, worked out the job losses in their areas.

…

[There were] no proposals to exit a country, we knew that it was about streamlining activities and businesses, it was “business as usual”, nothing bigger, there was no requirement for extra detail or information, it was ongoing opportunities to make the businesses more efficient, how they best operated within budget constraints, how do we leverage our tools and processes.”

46) Ms Ellerker agreed that there was no significant change in the figures between January and April 2020. But, she said, by April 2020 global HR management in the US had information from the businesses that led them to believe they had sufficient to meet the requirements of regulation 18A. But in the United Kingdom, management had no more information than what was provided to the EWC, the global picture was held in the US, the individual figures for Europe had come from the businesses.

47) Mr Abello agreed that there were no overall plans, no proposals. They were estimated numbers by each LI business, forecasts of what might or might not happen. He described the information provided in April 2020 as an updated forecast from January 2020, to give the EWC “some colour”. It would have been very difficult, he said, to break down the numbers by market or country.

48) Finally, Ms Ellerker told the panel that the figures were for job losses in FY20 which had ended on 31 October 2020. She understood there had been about 300 job losses but that figure included the separate OD&S exercise. She did not know how many were 2019 SAM and had no details of them. The job cuts had happened in stages, country by country, and she understood had not triggered any collective consultation exercises in any countries.

4. Summary of the EWC’s case

49) Mr Sack submitted that the employer failed to supply the information required by paragraph 18A of TICE. He reminded the panel of the terms of paragraph 18A(3):

“The content of the information, the time when, and the manner in which it is given, must be such as to enable the recipients to

(a) acquaint themselves with and examine its subject matter;

(b) undertake a detailed ^{[footnote 5]} assessment of its possible impact; and

(c) where appropriate, prepare for consultation.”

50) Mr Sack contended that the information provided by the employer was insufficient to enable the EWC to conduct “a detailed assessment of the possible impact” of the proposals. Detailed assessment required detailed information. The exceptional information and consultation meeting on 7 May 2020, based on that inadequate information, could not be a valid meeting within paragraph 8 of the SRs.

51) The EWC, he said, was not seeking to delay the employer’s implementation, but wanted clarity and to understand how, when and where the proposed job cuts would happen, to be able to provide a detailed opinion on the proposals.

52) The employer provided a Summary of Proposed Exits (137), described as part of the Transformation Project (136). The EWC needed to know how the numbers had been arrived at, why the particular numbers in markets and regions, what criteria had been used to calculate the numbers, what was the process, what savings and costs were involved, what was the financial rationale, what was the impact on the retained workforce and customers and the timescale and process for consultation. These, he said, were obvious questions when presented with a proposal for substantial job losses.

53) When the EWC asked for further information, in line with previous decisions of the CAC, the employer’s response was disappointing, and did not give any real information. It was impossible to undertake a detailed assessment. Nothing of significance came out of the meeting on 7 May 2020 except that information could not be provided because management did not have it, or it would be difficult to obtain, or the EWC was not entitled to have it.

54) In his Final Outline Submission dated 20 October 2020, Mr Sack broke down the 11 separate items of information the EWC had requested on 28 April and 6 May 2020 into four areas, as shown in bold below:

1) Information to enable the EWC to understand the rationale or thinking behind the proposed action and the financial basis

(1) how the numbers of job cuts in the different regions and the different parts of the business were arrived at;

(2) a breakdown of proposed job cuts by market and by business;

(3) expected savings and restructuring and redundancy costs by market and by business;

2) Information about the impact on employees, including retained employees

(4) the types of roles affected by the job cuts;

(5) the impact on the workload of retained employees;

(6) the expected impact on sales and customers;

3) Information on the links between transnational and national consultation

(7) how management intended to link consultation of the EWC with consultation of national employee representation bodies and the detailed timeline of implementation by country;

(8) the ratio of proposed job cuts in European Markets relative to worldwide job cuts;

4) Information on how the job cuts fitted within the wider Transformation Project:

(9) the ratio of European to worldwide job cuts;

(10) feedback on the status of previously-announced job cuts; and

(11) the impact of HP’s Transformation Project on the number of employees in each EEA country in 2020.

55) In Oracle (EWC/17/2017), the CAC found that information about the calculation of the number of job cuts and expected savings and restructuring and redundancy costs by region were necessary to understand the rationale for the proposals. As in that case, the employer’s default position in this case was not to disclose information about the proposed job cuts.

56) As in Vesuvius (1) (EWC/20/2019), the EWC in this case requested information about expected savings and redundancy and restructuring costs by region in order to understand and respond to the financial detail of the proposed restructuring at a transnational level, to understand the overall costs of the proposed restructuring, to understand the rationale and financial basis for the proposal, to have “the full picture” as to the commercial rationale for the restructuring, and the cost implications, so as to make fully informed submissions.

57) In contrast to what happened in Verizon (2) (EWC/23/2019), the EWC, before, at and after the meeting on 7 May 2020 had said what information and questions were outstanding, and in seeking such information had not sought to be able to make an assessment of the employer’s business case or put itself in the role of decision-maker but to perform its role and to understand the decision and the rationale for it.

How the numbers of job cuts in the different markets and the different parts of the business were arrived at

58) The management report gave a basic summary of proposed job cuts by four European Markets - 47 in Northern Europe, 72 in Southern Europe, 194 in Central Europe and 36 in UK and Ireland. It also gave a breakdown by ten L1 businesses: for example, 12 in 3D Print, 123 in Commercial Organisation, 48 in Supply Chain.

59) When presented with proposals for job cuts, a basic and fundamental question is how they have been arrived at, so why a particular number in one region but a lower number in another region, or why a particular number in one part of the business and not a lower (or even a higher) number in another part.

60) The report gave no information about how the numbers had been arrived at. On 28 April and 7 May 2020, the EWC asked for this information, but management never provided this information, misunderstanding the question in its 6 May 2010 reply.

61) The EWC was unable to carry out any assessment of the reasoning or rationale behind the numbers, let alone a “detailed assessment”, and was not able to “prepare for consultation”. It was unable to give any opinion about the numbers at, or after, the 7 May 2020 meeting.

62) On 7 May 2020 management did give some explanation of the rationale, referring in broad terms to cost reduction targets, a balance between cost cutting and minimising workforce reduction, “changing the way we work”, avoiding too deep cuts in one area or disproportionate impact on employees, “less infrastructure” in some regions, and demographics, sites and headcount in regions. These were all very vague, not shared in advance, and no detail was provided about cost reduction targets or how such targets had been decided.

63) The global proposals gave only an overall figure for generating $1 billion annual savings across five “transformation streams”. Management did not explain how the 350 job cuts fitted into these savings. The only EEA-specific financial information about the job cuts was the figure of $36 million “gross annualised run rate savings”.

Breakdown of proposed job cuts by market and by business

64) The management report broke down the proposed job cuts by four European Markets and separately by ten L1 businesses. Each of the four European Markets comprised more than one country - Northern Europe the Netherlands, Sweden, Belgium and other countries, Central Europe Germany, Poland, Romania and other countries, Southern Europe France, Italy, Spain and Portugal, and UK and Ireland two countries, both still within scope of the EWC’s geographical remit. Information at this regional level was “transnational” because it concerned “at least two of the employer’s establishments or group undertakings situated in different member states”. On 28 April 2020 the EWC asked for the number of job cuts by business in each market, but management refused to provide the information, saying it was not transnational.

65) At the meeting on 7 May 2020, management undertook to consider providing information on L1 job cuts by European Market, but did not provide it. This was “transnational” information that management was required to provide.

Expected savings and restructuring and redundancy costs by region and by business

66) The EWC expected to receive financial information about the proposed job cuts showing the rationale and justification for them, and the expected savings and costs associated with them. Such financial information was essential to carry out a detailed assessment of the proposals. But the only financial information in the management report was global. There was no financial information specific to the 350 proposed job cuts or to the EEA.

67) On 28 April 2020 the EWC asked for the expected savings and restructuring and redundancy costs for the markets that its members represented. On 6 May 2020, management responded with an expected “gross annualised run rate savings” figure from the proposals of approximately $36m, based on “HP average salary structures across countries.” Management stated that it was unable to provide precise redundancy cost figures as the information was not reasonably easily available.

68) On 7 May 2020 the EWC reiterated its request for a breakdown of savings resulting from the proposed job cuts by business segment and by market. Management, however, did not provide the information.

69) The requested information would have helped the EWC to understand the rationale for the proposed job cuts in the four European Markets and the ten L1 businesses. Management’s refusal to provide it contributed to the EWC’s inability to undertake a detailed assessment of the proposals and provide an opinion on them. The figure of $36m annual savings provided by management was not sufficient because it was based on average salaries across the four European Markets, whereas salaries would vary both by country and by role.

70) TICE does not limit the requirement to provide information to what is reasonably easily available. In any event, the EWC does not believe that management was unable to provide any information whatsoever about redundancy or restructuring costs in the EEA. Whilst final redundancy costs might not be known, management could have provided information about its budgeted costs.

The types of roles affected by the job cuts

71) On 28 April 2020 the EWC asked what type of roles would be subject to job cuts, for example in marketing. In its response of 6 May 2020, management replied that the impact could be across any of the employer’s businesses and organisations. On 7 May 2020 the EWC observed that management had not answered the question it had asked, but received no further information.

72) The types of roles affected by the job cuts would impact on the workload of retained employees. The information would have enabled the EWC to ask management about the development of relevant parts of the business and its sales and the effect of reducing investment in affected areas. So if there was a reduction in tax experts within the company, that might lead to a change in the workload of other finance jobs, affecting work organisation or working methods, on which the employer was required to consult the EWC (paragraph 7(4) 0f the schedule).

The impact on the workload of retained employees

73) An important EWC function is to assess the potential impact on employees of company restructuring and redundancy proposals, and to provide an opinion on this to management. This means not only the impact on redundant employees, but also on retained employees whose workload may increase, or who may take on new responsibilities or change the way they work to mitigate the impact of job losses. Ms Ellerker acknowledged the balance of work and the need to cut jobs only if work reduced or there were new ways of doing the work at the meeting on 7 May 2020.

74) In Oracle (EWC/17/2017)), the CAC noted that restructuring decisions may affect to a considerable extent the interests of retained employees and those whose work may be impacted by changes in work organisation or working methods.

75) On 28 April 2020 the EWC asked what the proposed job cuts meant for workload transfer and how it would be measured. In its response, management referred to the minutes of a separate exceptional meeting on 30 January 2020. In that meeting the EWC had asked a similar question about workload in relation to an earlier round of job cuts. Management had said then that it did not have a performance standard for workload, but employees struggling with workload should inform management.

76) On 7 May 2020 the EWC asked for an updated assessment of workload since January 2020, whether any impact of job cuts on workload had been detected, and whether any prevention methods had been put in place which were not mentioned by management on 30 January 2020. The EWC commented that removing even a small number of people could have a severe impact on workload, and asked what measures were being put in place to track workload. Management responded only that work was underway on standardising processes and analysing data needs.

The expected impact on sales and customers

77) On 28 April 2020 the EWC asked what the proposed job cuts meant for sales and customer impact, to which management’s response was that the measures were neither intended nor anticipated to reduce sales or impact on customer service, but to improve efficiency whilst maintaining standards.

78) On 7 May 2020 the EWC challenged whether the job cuts would have no impact on sales or customer service and referred to a discussion at the EWC annual meeting in January 2020 about sales and customer satisfaction impact of outsourcing invoicing. Management had acknowledged that lessons had to be learnt from the feedback about this. The EWC explained that this was why it wished to receive information about the expected impact on sales and customers (and therefore on employees and on employment generally). Management, however, argued that the EWC’s remit was about employee impact, not customer or sales impact.

79) The impact of job cuts on customers and sales is within the EWC’s remit because a loss of customers and/or reduction in sales could affect employees and employment within the business. Management must provide information on “the probable development of the business and of production and sales” (paragraph 7(3) of the SRs). This can help the EWC to understand and anticipate possible future job cuts and changes concerning organisation and introduction of new working methods on which it must be consulted (paragraph 7(4)). The EWC’s mandate is not limited to the number of job cuts management is planning to make.

How management intended to link consultation of the EWC with consultation of national employee representation bodies and the detailed timeline of implementation by country

80) On 28 April 2020 the EWC asked when, how and in what form local consultation and communication processes would take place per country. On 6 May 2020 management responded that any national information and consultation processes would take place in accordance with national law, and any such processes would be linked to the overall process so that they began within a reasonable time of each other.

81) This was another example of management providing the bare minimum of information, contrasted with the more constructive approach taken in relation to an earlier round of job cuts when it provided a detailed timeline for national consultation on, and implementation of, job cuts by country, enabling the EWC to see how transnational consultation linked with it and when the job cuts would actually be made.

82) On 7 May 2020 the EWC asked for an equivalent detailed timeline for the proposed 350 exits to that provided for the earlier round of job cuts, and asked how consultation and communication would be carried out in countries. Management did not provide this. On 7 May 2020 management simply said that a timeline for national consultation was not relevant “when talking about transformation”.

83) The EWC was not trying to audit the employer’s legal compliance or be a “regulator”. It had a legitimate interest in knowing how management planned to link consultation at the transnational and national levels when there was an explicit legal obligation to ensure they were linked so as to begin within a reasonable time of each other” (TICE regulation 19E(2)). Management accepts that regulation 19E(2) applies, and it is astonishing that management considers it does not need to provide any information about how it intends to comply with the obligation to link consultation.

Ratio of proposed job cuts in European Markets relative to worldwide job cuts

84) On 28 April 2020 the EWC asked for this information. On 6 May 2020 management gave the proportion of total HP-badged headcount in the EU/EEA that the job cuts would represent. The EWC repeated its request, explaining that it wanted to know, by business, the proportion that the EU/EEA job cuts were of proposed worldwide job losses. The EWC did not receive the information.

85) The EWC asked for this information to understand the extent to which the European Markets were to bear the brunt of the job cuts. When announcing the Transformation Project, of which these 350 job cuts were a part, the employer had stated that its worst performing region was EMEA (Europe, Middle East, Africa). The EWC wished to understand, as part of the rationale for the proposed job cuts, whether the European Region’s poor financial performance was reflected in the proportion of cuts relative to the global headcount reduction, by L1 business segment. This was why the EWC asked at the 7 May 2020 meeting, and in the email of 11 May 2020, about the impact on and possible closure of call centres, production sites, distribution centres/warehouses and offices, and if the strategy was to outsource certain activities.

Feedback on the status of previously-announced job cuts as per the Exceptional Meeting of 30 January 2020

86) On 28 April 2020 the EWC referred to the 123 at risk roles identified at the exceptional meeting on 30 January 2020, out of 7,000 to 9,000 worldwide job cuts, and asked where the employer was in the Transformation Project in the current year.

87) On 6 May 2020 management responded by referring to the All Employees email sent by the employer’s CEO on 30th April 2020:

“We will resume our focus on the cost management plan we shared last year. We announced in March that we would defer any previously planned workforce reductions (WFRs) through the end of May. That pause was intended as a temporary measure as we faced the COVID-19 pandemic. Now that we are moving into the next phase of this crisis, we will need to reduce our costs and execute against our original plan.

That’s why we’ll be accelerating our transformation agenda in ways that both reduce our structural costs and enable us to become a digital-first, data-driven company. One of the lessons of this crisis is that we must become more agile and resilient, with systems, tools, and processes that make us smarter and faster in responding to rapidly changing market conditions”.

88) The EWC responded that this did not answer the question. It asked for an update on the 123 at risk roles, on the 34 affected employees due to transfer to KPMG referred to in an email to the EWC dated 7 February 2020, and any other exits that had so far taken place, whether the 123 were included in the 350, as the number of employees per country did not show what changes had taken place as a result of the Transformation Agenda, and asking what was meant by “accelerating our Transformation Agenda”. Management answered only that the 123 job cuts were separate from the 350.

89) The requested information formed part of “the situation and probable trend of employment” within paragraph 7(4) of the schedule to TICE, and should have been provided to the EWC.

The impact of the Transformation project on the number of employees in each EEA country in 2020

90) On 28 April 2020 the EWC asked for an update on the employment impact of the Transformation Project in the year to date by EEA country. On 6 May 2020 management responded by providing a PowerPoint slide which simply showed the number of employees in each EEA country in January 2020 and in May 2020. This did not show what changes had taken place as a result of the Transformation Agenda. The EWC never received the information it requested, and this also formed part of the “situation and probable trend of employment” required by paragraph 7(3).

91) For these reasons, the EWC contends that the employer failed to comply with the requirements of regulation 18a and paragraph 8.

5. The employer’s case

92) At the start of the hearing on 5 November 2020, Mr Hopper conceded that if the complaint alleging failure to provide information in accordance with regulation 18A succeeded, it must follow that the meeting on 7 May 2020 based on that information was not a valid meeting and that part of the complaint must also succeed.

93) Mr Hopper contended that the employer faced the dilemma of beginning the information and consultation process early when it did not have enough information, and being met with a complaint that it had not provided sufficient information, or leaving the process until it had information and facing a claim that it had not informed and consulted early enough.

94) In this instance, in October 2019 the employer did not know where the 7,000 to 9,000 job cuts would be, but gave a commitment to inform the EWC when it had more information. In January 2020 it knew that proposals were being formulated for 350 job cuts within the EU/EEA, but believed it did not have the information it needed to meet regulation 18A. In April 2020 it made the decision that it had enough information to satisfy regulation 18A and, therefore, that exceptional circumstances within paragraph 8(1) of the schedule now existed.

95) Mr Hopper reminded the panel that TICE does not define “information” (unlike, for example, the Trade Union and Labour Relations (Consolidation) Act 1992 for domestic collective redundancy consultation). The employer consistently and voluntarily engaged with the EWC, commenced a formal process under TICE, provided the EWC with a report containing all relevant information, and voluntarily answered the EWC’s questions seeking further information. It cannot be liable for declining, or being unable, to answer all the EWC’s questions.

96) Mr Hopper drew the panel’s attention to the employer’s Statement of Case dated 23 July 2020 (43-57) and case authorities set out in the appendix, especially British Council (2) and Oracle, whilst acknowledging that such decisions do not bind the panel. Following Vesuvius, the CAC must determine factually whether what was provided was, in all the circumstances, enough to satisfy regulation 18A.

97) In its Statement of Case, the employer made a number of further propositions, materially as below.

98) The employer was not obliged under TICE to make transnational decisions in a way that satisfied the EWC, and there was nothing unlawful in the employer making flawed decisions (this was its prerogative under paragraph 8(4)). It was not the EWC’s role to audit the employer’s compliance with local law, to receive information as if it was a local representative being consulted or to know about local or national processes, and the EWC was not entitled to market-level or national-level information as distinct from transnational information. The EWC was not entitled to more information that the employer had as decision-maker.

99) It was notable that the EWC did engage in dialogue at the meeting on 7 May 2020, for example on the limited nature of a headcount reduction of 4% or the possibility of achieving greater cost savings by cutting more jobs or, if information did not exist, decisions being made without information or clear line of sight.

100) The purpose behind the Recast Directive (and thus TICE) includes minimising burdens on undertakings to what is strictly necessary, avoiding slowing down decision-making, making it possible to express an opinion on an informed basis whilst not calling into question undertakings’ ability to adapt, and providing opinions that would be useful in the decision-making process.

101) British Council (2) (EWC/7/2012) held that information might be provided as part of a continuous process of discussion before and after a meeting (para 87); information might be provided outside scheduled meetings and in answer to questions from the EWC, as part of a regular flow of information.

102) Oracle (EWC/17/2017 and UKEAT/0194/18) references the distinction between seeking financial detail of the business case for reorganisation to try to get management to change its mind, and seeking information necessary to understand the rationale or thinking behind a proposed action in order to represent the interests of affected employees and express an opinion which may be useful in the decision-making process.

103) Vesuvius (1) (EWC/20/2019) concerned an EWC operating under negotiated arrangements rather than the SRs. But at para 83, the CAC suggested that information about redundancy costs split between different countries was a request for information of national not transnational nature.

104) Verizon (2) (EWC/23/2019), also arose from a negotiated agreement. The CAC held that it was not the EWC’s function to make an independent assessment of the viability or soundness of the employer’s business reason; limited financial information was enough when the exercise was not cost-driven but a strategic investment for the organisation; and

“There is no “bright line” test of the adequacy of information; in order to fulfil its role the EWC must understand a decision and the rationale for that decision…However this does not mean the EWC should feel unable to fulfil its role without having access to the full range of information it considers it would need were it in the shoes of the employer as decision-maker.” (para 52).

105) The employer does not address the reasonableness of the EWC’s specific requests for information. This is because there is no need for the panel to examine whether each and every question asked by the EWC was reasonable because the evidence shows that the employer had genuinely sought to address the questions asked.

106) The employer asserts that it consistently engaged with the EWC in good faith and beyond its obligations under TICE, including in the following respects:

(a) it voluntarily met with the EWC on numerous occasions including on 3 October 2019, 23 October 2019, 30 April 2020 and 27 May 2020. It also offered on 23 April 2020 to meet the EWC to discuss the information that it provided on that date about the impact of Covid-19;

(b) it unambiguously committed to provide the EWC with any new information that was available to it about the 2019 SAM on 23 October 2019, 25 October 2019 and 24 January 2020. It fulfilled those commitments on 24 January 2020 and 17 April 2020; and

(c) it provided an answer to each of the additional questions that the EWC asked on 28 April 2020 despite TICE providing the EWC with no right to request the disclosure of information.

107) The EWC, however, consistently approached the employer with suspicion and in breach of its duty to act in a spirit of co-operation pursuant to regulation 19 of TICE. A member of the EWC stated during the exceptional information and consultation meeting on 7 May 2020 that “I don’t want to believe they don’t have this information”, and suggested on an entirely unsubstantiated basis that the employer was holding back information. Mr Gastmans repeated on 2 June 2020 in respect of certain requested information that he was convinced it existed. The EWC suggested on 23 June 2020 that it was not acceptable for management simply to declare that it would comply with the law without providing any evidence of how it would do so.

108) The case turns on whether the employer provided sufficient information to enable the EWC to carry out the tasks listed in regulation 18A(3) of TICE. It does not turn on whether the employer provided information or answers to the EWC’s questions that were satisfactory to the EWC. Unlike in Vesuvius (1) and Verizon (2), the employer was under no contractual obligation to answer questions in addition to providing its report. The employer provided a report and answered the questions the EWC asked.

109) Further, the minutes of the meeting on 7 May 2020 illustrate that the report and additional information did enable an exchange of views and dialogue between the parties following the EWC acquainting itself with them, undertaking a detailed assessment of them and preparing for consultation. In particular:

(a) in respect of the reduction in roles equating to around 4% of employees, Mr Gastmans expressed concern at any reduction as the employer was “saying the impact is very limited but if you have an [organisation] like mine in Belgium with around 120 employees even removing 1 has a severe impact on the workload”; and

(b) in respect of the reduction in roles, another member of the EWC provided a contrasting view that “if what we are looking for is cost savings why not double the number and double the cost savings”. Mr Gastmans elaborated on this idea and suggested that, for example, instead of a reduction of 194 roles in one region, management could consider a reduction of 360 roles.

110) Accordingly, the employer contends, the CAC should determine that the EWC’s complaint is not well-founded.

6. The EWC’s response to issues raised by the employer

111) The EWC accepts that the Recast Directive and TICE reflect a balance of interests of employers and employees. But the legislation has been drafted to minimise the burdens on employers, and the requirement to provide information enabling it to undertake a detailed assessment of the possible impact is the minimum burden possible. It does not remove from the employer any burden at all, or limit it to providing reasonably easily available information.

112) The EWC does not seek to hinder the employer’s ability to adapt, or to slow down decision-making within the company. Any risk of slower decision-making through consulting the EWC stems from management’s delay in starting the process, and its delay or failure in providing the required information.

113) The EWC is not prejudicing management’s responsibilities in any way by simply giving its opinion on management proposals. It is well aware that it is only being consulted about proposals, and has no power to stop or change decisions. It realises that it has no co-decision-making powers with management. It does not understand why management seems to have such a problem with consulting it and does not appear to want an informed dialogue.

114) The employer has focused exclusively on the employer’s interests in its analysis of the Recast Directive. The EWC would focus on the counter-balancing employees’ interests found in the Directive. Article 1.2 states that

“The arrangements for informing and consulting employees shall be defined and implemented in such a way as to ensure their effectiveness and to enable the undertaking or group of undertakings to take decisions effectively”. Information and consultation must be “effective”. One of the key components of “effectiveness” is the provision of information with such content and timing as enables the EWC to undertake an in-depth assessment of the proposals and prepare for consultation. Without this, consultation cannot be “effective”.

115) TICE does not exempt management from providing information if it claims it would be a “burden” for it to collate it; and as confirmed by the Employment Appeal Tribunal in Oracle [UKEAT/0194/18]). there is nothing in TICE preventing the employer proceeding with a decision before it has received an opinion from its EWC.

116) British Council (2) supports and reinforces the EWC’s case. In contrast with British Council, there was no process of discussion about the proposed 350 job cuts between the EWC and management before the 7 May 2020 meeting and no ongoing discussion after it. The only “discussion” was an exchange of emails concerning the lack of information that had been provided. Also in contrast with the facts in British Council, the employer has not adduced any evidence that its consultative process regarding the 350 job cuts involved any ongoing communications with the EWC, or that any further consultation took place beyond that which it claimed took place at the 7 May 2020 meeting. Nor could it do so because there simply was no such consultation. As for the EWC asking for additional information, as already stated, the employer was normally not willing to provide it.

117) In this case, the employer did seek to withhold information; when the EWC asserted during the process, for example on 7 May and 2 June 2020, that certain information must exist, this was not mere suspicion but reflected that the figures must have existed to collate the information actually provided. There was no regular flow of information and what little “consultation” that took place was wholly inadequate. To the extent that the employer compares itself with the employer in the British Council case, it compares rather unfavourably.

118) As to the employer’s contentions at paragraph 106 above, sub-paragraphs (a) and (b) are irrelevant, and what was provided at (c) was inadequate.

7. Discussion and conclusions

119) The issue for the panel in this case is whether the employer, in the circumstances of the case, gave information to the EWC, and consulted with it, as required by regulation 18A of TICE, about its proposal to make up to 350 job cuts in the EU/EEA. The employer concedes that if it did not, the exceptional meeting on 7 May 2020 did not satisfy paragraph 8.

120) The relevant provisions are regulations 18A(3) and (5), The panel set them out at paragraphs 10 and 11 of this decision. In its submissions, the EWC has criticised other aspects of the process followed by the employer, including the delay in arranging an exceptional information and consultation meeting after 24 January 2020, the refusal to hold two meetings or permit its expert to attend the meeting on 7 May 2020, the late provision of answers to the EWC’s questions in April and May 2020, and the refusal to postpone and rearrange the meeting of 7 May 2020. At the hearing, however, Mr Sack focussed on the content of the information provided, which he said was insufficient to enable the EWC to undertake a detailed assessment of its possible impact or for consultation to take place allowing the EWC to express an opinion based on that information.

121) The requirement to inform and consult the EWC arose in the context of the employer’s proposals to make up to 350 job cuts within the EU/EEA during its 2020 Financial Year. The employer accepts that these amounted to exceptional circumstances affecting the employees’ interests to a considerable extent, involving collective redundancies. This gave the EWC, under paragraph 8 of the schedule to TICE, the right to be informed and at its request, to meet management at an information and consultation meeting so as to be informed and consulted.

122) It is a decision of fact for the panel whether, in all the circumstances, the information which the employer provided was sufficient to enable the EWC to undertake the detailed assessment and for consultation to take place, as referred to in regulation 18B(3).

123) The parties have referred the panel to earlier decisions of the CAC on information and consultation under regulation 18A. These decisions evidence how other panels have approached the issue but they are not binding on this panel and themselves turn on their own facts.

124) British Council (2) [EWC/7/2012] involved an EWC operating under the SRs. The CAC held:

“87) The complaint contained 3 elements, although the elements or heads of complaint overlapped. The first element was that the Employer allegedly failed to provide information in a timely manner, which was said to be contrary to Regulation 18A(3) and (5). According to Mr Haines, the Employer had failed to give the EWC sufficient time to digest information and reports with a view to being able to produce an informed opinion and engage in meaningful consultation. The report to which Mr Haines’s complaint primarily related was presented at the Paris meeting on 28 March 2012. It dealt with matters around the issue of restructuring. The Panel accepts that Mr Haines on behalf of the EWC felt that more time was needed for the purposes of producing an opinion and engaging in consultation. On the other hand, the Employer adduced evidence that this issue was in effect the subject of a continual process of discussion before and during the Paris meeting and was an on-going discussion after it.

88) The second element of the complaint was that the Employer allegedly failed to provide sufficiently detailed information, which was said to be contrary to the same provisions. Once again the Employer adduced evidence that its consultative process involved on-going communications with the Steering Committee as well as the EWC, and that further consultation took place between the scheduled meetings of both the full EWC and the Steering Committee. The Employer showed a willingness to communicate and meet with both bodies, and to do so more frequently than required by the letter of the Regulations. Further, as an important part of this process, the EWC was able to ask for additional information by way of clarification, and if such information was available at the time, the Employer was normally willing to provide it.

89) In respect of the first two complaints the Panel is satisfied that the Employer has not sought to withhold information, but rather it saw evidence that there was a regular flow of information and adequate consultation. The Panel concludes that overall the content of the information, and the time when and the manner in which it was provided enabled the recipients to acquaint themselves with and examine the subject matter, undertake a detailed assessment of impact, and to prepare for consultation. The Panel also concludes that the content of the consultation, and the time when and the manner in which it took place, was such as to enable the EWC to express an opinion. The Employer thus complied with Regulation 18A(3) and (5)”.

125) Following British Council (2), the panel finds that that in reaching its decision of fact about whether the information provided, and the consultation, was sufficient within regulations 18A(3) and (5), it should consider the overall pattern or flow of communication between the parties. However:

(a) that overall flow of communication must concern the proposals in question, rather than generally;

(b) even if, as Mr Hopper contended, and as set out at paragraph 106 above, the employer may have communicated about other matters, that is irrelevant as to whether it met the requirements of regulation 18A and paragraph 8 about these proposals;

(c) paragraph 8(3) provides that the information and consultation meeting shall take place on the basis of the report provided by management, demonstrating the importance of the contents of the report as to compliance with regulation 18A and schedule 8; and

(d) although the panel agrees with Mr Hopper that the employer is not required to answer each of the EWC’s questions, in assessing the overall flow of communication between the parties, the panel can and should take into account what was asked and how it was answered.

126) Oracle [EWC/17/2017] also involved an EWC operating under the SRs. The CAC noted as a “general point” that there are “boundaries to be drawn” on an EWC’s remit. It then noted:

“84. What appears to us to have been lost in the exchanges between the parties is a distinction between, on the one hand, seeking financial detail of the business case for reorganisation in order to challenge or seek to reverse managerial decision and, on the other hand, seeking information necessary to understand the rationale or thinking behind a proposed action in order to represent the interests of those employees affected by it and provide an opinion which “will be useful in the decision-making process”.

127) This seems to the panel not to be an altogether easy distinction to draw in any particular case. TICE requires that the information given must be enough to enable the EWC to undertake a detailed assessment of the impact of the proposals, which, in the panel’s view, must include information sufficient to understand the in depth financial thinking or rationale for the proposals.

128) Vesuvius (1) [EWC/20/2019] was a decision about an EWC operating under a negotiated agreement which included a contractual right to request information “if available”. The panel reminds itself that such cases may turn on the wording of the agreement between the employer and the CAC; in cases under the SRs, the issue is what the legislation requires.

129) The CAC said this:

“83)… Had the EWC’s request sought information on likely redundancy costs split between the different countries affected then we accept that it would have been a request for information of a national rather than transnational nature falling outside the scope of the EWC agreement…

…..

96) That said, even if the likely redundancy costs requested had not been collated centrally at the time of the request, the information which the EWC had requested but which was not provided could in our assessment have been collated by the Employer reasonably quickly - especially given the relatively limited number of countries involved and the fact that the local redundancy consultation procedures were to commence concurrently with the EWC consultation process so that likely redundancy costs would need to be calculated in those jurisdictions in any event in reasonably short order. The request was therefore in our view one which fell within the parameters of Annex 6 of the Agreement and was one that the EWC could expect the Employer to comply with”.

130) This case reminds the panel that information and consultation must fall within the EWC’s transnational remit. It will also be a question of fact for the panel whether, if information is not in the hands of central management, it may be reasonably accessible, in the context of the obligations upon management under TICE.

131) Verizon (2) [EWC/23/2019] also concerned an EWC operating under a negotiated agreement. That agreement prescribed the information that the employer was obliged to provide and gave the EWC a contractual right for the employer to answer its questions:

“50) The Complainant chose four areas to exemplify its contention that the information provided by the Employer was insufficient to enable it to carry out its role. These were set out in paragraph 37 above. The Panel has therefore commented specifically on these areas in this decision although it also considered carefully the information provided in all the remaining contexts. The first was that there was no proof that the current teams were inefficient or ineffective. The Panel concurs with the view of the Employer that it is not the role of the Complainant to make an independent assessment of whether a business decision is sound nor, therefore, is there an obligation on the Employer to provide proof to persuade the Complainant of the viability of any such decision to the Complainant’s satisfaction. The second was that information provided about the benefits of the company, customers and employees was inadequate. Again the Panel is satisfied that the information provided by the Employer was sufficient to enable the Complainant to understand why the Employer had come to the view that it had. The third was financial information. The Panel notes that the slide on which the information was given expressly stated that the Project was “not a cost reduction driven project but a strategic investment for our organization”. That being so the Panel does not consider that the Employer was required to give a greater breakdown of the costs than appeared on the slide in question.

….

52) The Panel agrees with the Complainant that there is no “bright line” test to determine whether the information provided by an Employer is sufficient in any given context. The Panel also agrees with the Complainant that in order to fulfil its role it must understand a decision and the rationale for that decision. However this does not mean that the Complainant should feel unable to fulfil its role without having access to the full range of information it considers it would need were it in the shoes of the Employer as decisionmaker. The Complainant said that ultimately the question for the Panel was whether the Complainant had acted reasonably in compliance with its obligations in asking for information and whether the information given was sufficient or insufficient. The Panel does not consider it necessary to examine whether each and every question asked by the Complainant was “reasonable” because the evidence showed that in any event the Employer had genuinely sought to address the questions raised prior and up to 10 April 2019. The Panel appreciates that the Complainant felt that some of the questions it had raised on 16 January 2019 had not been answered but the Complainant did not specify what these questions were so the Panel was unable to consider that contention further. In relation to the sufficiency of information, having reviewed the totality of the evidence before it the Panel has concluded that the information provided by the Employer was sufficient in the circumstances to enable the Complainant to carry out its role in the information and consultation process. The Panel has therefore decided that the Complainant’s first complaint is not well-founded”.

132) The principles applied in Verizon, with which this panel agrees, are that

(a) the EWC is not entitled to the same information available to the employer as decision-maker;

(b) the extent of the information required will depend on the rationale for the proposals. In Verizon, the extent of the financial information required related to the justification of the exercise as strategic investment, not cost reduction;

(c) it is not the role of the EWC to assess whether the employer’s business reasons are sound;

(d) it may be unnecessary to examine each and every detailed request for information made by the EWC; and

(e) there is no definitive, “bright line” test whether information is sufficient in any particular case; it is a question of fact.

133) The panel’s focus is on the sufficiency of the information the employer provided. The EWC’s questions are relevant to the analysis of what information the employer should have given, but the panel does not find it necessary to consider fully the very detailed questions the EWC asked.

134) The context was the employer’s notification in April 2020 that up to 149 job roles might be at risk in the period June to October 2020, across four European Markets and 10 L1 businesses in EU/EEA countries. As each European Market and LI Business involved two or more countries within the EU/EEA, the proposals were transnational within paragraph 6 of the schedule to TICE.

135) What information did the employer provide? First, in the 2019 SAM, it announced a business transformation programme which, over three years, would lead to a global workforce reduction of between 7,000 and 9,000 people, saving $1bn. There was no information about impact within the EU/EEA. Second, on 24 January 2020, it informed the EWC of proposals “being formulated” for up to 350 job cuts within the EU/EEA, but gave no detail of them.

136) Third, on 17 April 2020, the employer advised the EWC that it had more information about the 350 job losses which meant that exceptional circumstances existed within paragraph 8(1), and following confirmation from the EWC that it wished for an exceptional information and consultation meeting, it gave its management report on 23 April 2020.

137) Interposing at this point, Mr Hopper submitted that exceptional circumstances (within paragraph 8(1)) came into existence when the employer decided that it had enough information to satisfy regulation 18A. The panel does not agree. Whether exceptional circumstances existed is a question of fact. There is no guidance in TICE, or in the Recast Directive, as to what level of decision-making or intention must exist to lead to the existence of exceptional circumstances, but it seems clear that the employer must have formulated or crystallised proposals with some degree of certainty. In the panel’s view, the existence of the exceptional circumstances triggers the obligation to inform, not the other way around; if such circumstances exist, the employer must take the necessary steps to inform and consult.

138) In any event, the employer does not dispute that exceptional circumstances existed in April 2020. Further, the two confidential slides within the management report contained specific figures as to job losses within four European Markets and LI businesses across the EU/EEA. The precision of these figures, the fact that they arose under a widely-announced global Transformation Project, and that, as Ms Ellerker told the panel, job losses began within a short time, from June 2020, establish that these were developed job cut proposals emanating from the employer’s several businesses within the EU/EEA. The panel does not accept Ms Ellerker’s and Mr Abello’s assertion that they were only forecasts, which might or might not happen, allowing of course that consultation processes and redeployment might affect the final numbers; Ms Ellerker accepted in evidence that she did not know the detail of the proposals in April and May 2020, or what process had led to the identification of detailed proposed numbers by April 2021; it seemed to the panel that she was saying what she thought they must be, rather than what they were. But she felt able to say in the meeting on 7 May 2020 that the proposals had followed “days and weeks” of thought.

139) The non-confidential slides in the management report set the 2019 SAM context. The two confidential slides gave the figures by European Market and L1 business, and the timeline for the job cuts. But there was no more detail.

140) In response to detailed questions asked by the EWC on 28 April and 6 May 2020, the employer provided further information on 6 May 2020 and at the meeting on 7 May 2020. The panel set out what was provided on 6 May 2020 in full at paragraph 38 above, and does not repeat it, and summarised the meeting on 7 May 2020 at paragraph 41; in the meeting management informed the EWC in very general terms that the job cuts were driven by transformation and cost reduction targets, they represented less than 4% of EU/EEA headcount, a balanced approach was being taken, analysing needs and processes, and “some markets were changing – was the company efficient enough, leaving space to go where the demand will be. Management reinforced that a lot of leaders were spending a lot of time looking at all eventualities and when decisions or proposals were made these were not made overnight but they spent days or weeks discussing them on how to balance the mix, transformation with the least disruption, dealing with people, not just employees but customers and partners too”.

141) Management did not provide any further information after the meeting on 7 May 2020.

142) The panel turns to its decision. It has concluded that the information given by the employer was insufficient to enable the EWC to undertake a detailed assessment of the possible impact of the information, or to provide an opinion following consultation based on such information. The employer therefore failed to comply with regulation 18A of TICE.

143) The panel begins with three general observations. First, after careful examination of the information provided, the panel has been unable to find a clear statement of the basis of the proposals explained by Ms Ellerker during the hearing. That was that there was no common plan or exercise underlying the proposals which originated from individual L1 businesses’ efforts to align and manage their activities within the aims of the global Transformation Project. The information provided could not have enabled the EWC to carry out a detailed assessment of the proposals when the underlying basis for them was not articulated.

144) Second, Ms Ellerker asserted that at the material time, management did not know how the individual businesses had arrived at their proposals for job cuts, and the employer could only communicate the information management actually had. The panel rejects this. Allowing that the proposals emanated from individual businesses’ proposals within the overall Transformation Project, the panel finds that it would have been relatively easy for management to obtain from the individual businesses within the European Group further information about their proposals. Information was held by the European businesses who had provided the figures as part of global workforce planning; the figures did not arise in a vacuum, and had been developed between January and April 2020 into specific numbers across L1 businesses. As the panel will shortly explain, in several respects the information provided did not allow the EWC to conduct a detailed assessment of impact, and it is no answer in the circumstances of this case for the employer to say that it did not have the required information when it was ascertainable from the businesses which had provided it. Whilst asserting, during discussion with the EWC and in this hearing, that information did not exist or would have been unduly difficult to obtain, the employer has not adduced evidence that it would have been unduly onerous or difficult to obtain it. Once exceptional circumstances existed, as they did by April 2020, the employer was required to provide the information required under regulation 18A, and could have sought the required information within its European businesses. That information clearly existed to allow the detailed figures to be produced.

145) Third, the information was transnational; it concerned the activities of the employer’s four European Markets, and 10 L1 businesses, each of which operated across at least two EU/EEA countries.

146) The panel finds that the employer failed in the following respects to provide information which it should have provided within regulation 18A to enable the EWC to carry out a detailed assessment of impact, by transnational European Market and L1 business:

(a) it did not provide the financial rationale for the specific job cuts, without which the EWC could not know and assess, and in consultation provide an opinion on, the financial basis for the proposed job cuts. This was not to audit the employer’s reasons or interrogate the financial soundness of the proposals, but simply to understand and assess the basis for them. The EWC sought this information on 28 April 2020 in asking how the numbers had been arrived at, but the employer identified only that the job cuts arose from cost reductions. Where, as it stated at the time and in evidence to the panel, the proposals originated from cost reductions, it was necessary for the employer to explain the detailed financial rationale for the cuts;

(b) it provided the number of job cuts in each European Market and L1 business, but did not explain how each number had been arrived at, which was fundamental to understand and assess the basis for the proposals. Again, the EWC sought this information before the meeting on 7 May 2020;

(c) it gave inadequate information about the savings and costs involved, having been asked by the EWC on 28 April 2020. Even if final redundancy/reorganisation costs were not known, the employer should have been able to supply provisional figures forming part of the financial basis for the proposals. The figure based on average salaries across European countries was meaningless, when not based on the actual jobs proposed to be lost;

(d) it did not identify the actual job roles proposed to be cut. It is impossible to understand how the EWC could carry out a detailed assessment without knowing what jobs were to go within the businesses, and what business process and reasoning informed what job roles should go. As was put to Ms Ellerker in the panel hearing, for example, a loss of 48 jobs within the Supply Chain could arise from the closure of a single warehouse in one country, or the discontinuance of a service across Europe; the EWC had no means of knowing what was intended and undertaking a detailed assessment of it;

(e) what was the impact on the retained workforce and on customers. The panel does not agree that for a paragraph 8 meeting, the EWC was necessarily entitled to the information necessary for a paragraph 7 meeting; but it was, in the panel’s view, within the purview of the EWC within the paragraph 8 process to have information to understand and assess the effect of the proposed job cuts on the employer’s business and the workload of remaining employees. The panel does not agree with the employer that the EWC’s role was limited to the direct effect on employees whose jobs would be lost; TICE does not so limit the concept of the impact of proposals, and they were capable of impacting the employees left behind and how the businesses affected would be conducted. The generalities provided by the employer did not sufficiently inform the EWC; and

(f) the employer failed to identify the steps to be taken to link consultation with the EWC with consultation with national employee representative bodies, in circumstances where regulation 19E applied as substantial changes in work organisation were likely given the number of proposed job cuts. It was insufficient merely to assert that the processes would be linked.

147) Although the EWC sought other information in April and May 2020, such as the ratio of job cuts within Europe to those worldwide, or details of progress with the overall Transformation Project, the panel foes not find that such information was required to undertake a detailed assessment of the proposals within regulation 18A.

148) The panel therefore finds that in the respects identified in this decision, the central management of the employer failed to provide information to the EWC as required by regulation 18A, or to consult about the proposals in a way which enabled the EWC to express an opinion when the information on which consultation was based was inadequate, and in consequence, failed to hold a valid exceptional information and consultation meeting within paragraph 8.

8. Decision of the CAC

149) The EWC brings this complaint under regulation 21 of TICE. Regulation 21(4) provides that where the CAC finds the complaint well-founded, it shall issue a decision to such effect.

150) Also under regulation 21(4), the panel has power to make an order requiring the defaulting party to take such steps as are necessary to comply with the terms of the schedule.

151) The default in this case relates to the exceptional information and consultation meeting under paragraph 8 of the schedule. The meeting was about proposals for up to 350 job cuts in the employer’s Financial Year 2020.

152) There is no dispute that the financial year had ended on 31 October 2020. Ms Ellerker told the panel that that meant there were no longer any proposals which had been the subject of the May 2020 meeting. Mr Sack acknowledged that but contended that it would “still be useful” for the EWC to have the information it had requested in April and May 2020, but modified for the passage of time. Mr Hopper contended that as there were no longer any proposals, there was no longer anything to which an order could relate.

153) The panel has concluded that no formal order should be made, when the proposals to which the complaint relates no longer exist. However, the panel informally recommends that the employer provide to the EWC at the annual paragraph 7 information and consultation meeting a report about the job cuts giving the information about them set out at paragraph 146 above.

154) The decision of the CAC on this complaint, therefore, is that:

(a) the complaint of failure to comply with the provisions of regulation 18A of, and paragraph 8 of the schedule to, the Transnational Information and Consultation of Employees Regulations 1999 (as amended) is well-founded;

(b) no other order should be made.

The Panel

Mr Stuart Robertson, Panel Chair

Mrs Susan Jordan

Ms Fiona Wilson

2 December 2020

9. Appendix 1

Attendees for the Complainant:

Philip Sack Director, EWC Legal Advisers

Bart Gastmans HP Belgium - EWC Chair

Attendees for the Employer

David Hopper Managing Associate Lewis Silkin LLP

Sharon Ellerker Global Head of HR – Marketing, Finance & Communications

Oriol Abello Labour Relations Lead, European Markets & ISE

1. “SAM” stood for Securities Advisory Meeting, a means of communicating price-sensitive information to the US market. ↩

2. Financial Year 2020. ↩

3. This was Ms Ellerker’s email of 24 January 2020. ↩

4. The employer divides its businesses hierarchically using designations, L1-10, L1 denoting businesses whose functional heads report directly to the Chief Executive Officer. ↩

5. Neither Mr Sack nor Mr Hopper suggests there is any significance in the difference between this term and the words “in depth” in Article 2.1(f) of the Recast Directive. ↩