ABSTRACT
The European Commission has a long history of introducing measures to encourage employee involvement and employee consultation in the enterprises in which they are employed. An establishment is a unit of business where an economic activity is carried out on an ongoing basis with human and material resources. The facts that the business could not be sold and that there were no orders were common to insolvency situations and not enough in themselves to justify being special. Without statutory intervention such employees, if the insolvent business is not taken over or sold to a new employer, would merely join other creditors hoping to receive at least part of that which is owed to them. This was one of a number of statutes aimed at setting up European legal entities which would help organisations to carry out their business in different Member States within the Community without being hindered by a legal organisation based on rules of just one Member State.
