Tuesday 27 November 2012

Strike-outs and Core Factual Disputes


[Thanks to Sian McKinley of Cloisters for preparing this case summary]
Where there is a 'crucial core of disputed fact', can a case still be struck out?

Yes - provided evidence is heard on the factual disputes - says the EAT in Eastman v Tesco Stores.

Ms Eastman was a part-time customer assistant. As a result of personal difficulties, she sought and was granted a career break of four years. It was her case that there was an express agreement that she could return to her old job on the termination of the career break. This was denied by Tesco.

In 2012 she attempted to return to her old job but her request was refused. She brought a claim for unfair dismissal and relied on the alleged express agreement to show that her employment continued through the career break. At a PHR, the employment judge heard evidence from Ms Eastman and an employee of Tesco. He concluded there had been no express agreement that Ms Eastman could return to her old job on the termination of the career break. The case was struck out on the basis it had no reasonable prospects of success.

Ms Eastman appealed and contended there had been a misapplication of the law of strike-out. Ms Eastman relied on the proposition that, where there is a crucial core of disputed facts, these are not susceptible to determination other than at a full hearing having heard the evidence. Such a case is not suitable for strike-out.

The EAT noted that an employment judge may take into account oral and documentary evidence at a PHR. Having heard evidence, an employment judge is entitled to resolve a core factual dispute. Having so resolved the factual dispute, the employment judge is entitled to conclude that a claim had no reasonable prospects of success. This case could be distinguished from those cases where no evidence was heard and there remains a crucial core of factual dispute at the PHR stage, such as in Ezias, Balls and Shoebridge.

Dismissals involving accumulated warnings


[Thanks to Ed McFarlane of Deminos HR for preparing this case summary]
When considering the fairness of a dismissal based on accumulated disciplinary warnings, may a tribunal look behind earlier warnings?

No, says the EAT in Wincanton Group v Stone, unless satisfied that an earlier warning was issued in bad faith or was manifestly inappropriate.

The Claimant (a lorry driver) was dismissed for misconduct after a serious driving accident, on the back of a written warning for different misconduct. The employment tribunal found the dismissal unfair, having considered that the Claimant challenged the earlier warning (here by a tribunal claim) and how it arose, although that warning was found to be valid.

The EAT overturned the finding of unfair dismissal, remitting the case for re-hearing and set out guidance for tribunals dealing with dismissals involving accumulated warnings (paragraph 37).

The overall question is the reasonableness of the employer's act of treating conduct as a reason for dismissal under Section 98(4) ERA, and tribunals should:

  • take into account the fact of an earlier warning;

  • take into account any proceedings that may affect the validity of a warning (usually an internal appeal), and consider what weight the employer gave to any challenge before dismissing;

  • avoid "going behind" an earlier warning by considering its validity, unless satisfied that to do so is appropriate.

  • But tribunals are not "going behind" a warning by taking into account the factual circumstances that gave rise to it, e.g. considering whether the types of conduct giving rise to an earlier warning and ultimate dismissal were similar or not, and tribunals may consider the particular features of a situation, as well as the consistency of the employer's approach.

    Unfair Dismissal and Article 8


    [Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]
    Does the 'band of reasonable responses' test in unfair dismissal have to be modified where an employee's rights under Article 8 of the European Convention on Human Rights are engaged as a consequence of the dismissal?

    No, says the Court of Appeal in Turner v East Midlands Trains.

    This case concerned the dismissal of a train conductor for alleged ticket irregularities. The employment tribunal applied the 'band of reasonable responses' test to both the fairness of the employer's investigation, and its ultimate decision to dismiss for the purposes of section 98 (4) of the ERA 1996 and found the dismissal fair.

    The question was whether the tribunal was right to do so if Article 8 of the ECHR (right to respect for private and family life) were engaged. The tribunal found that Article 8 was not in fact engaged. But even if it were, and section 98 (4) had to be read compatibly with Article 8 (in accordance with Section 3 of the Human Rights Act 1998),  the tribunal considered that (applying X v Y) the 'band of reasonable responses' test is in itself compatible with Article 8.

    On appeal to the Court of Appeal  the claimant pursued the argument that Article 8 was engaged and therefore the employer's investigation did not satisfy the alleged stricter procedural requirements which the proper protection of Article 8 rights requires. The employer argued that the claimant could not argue that her Article 8 rights had been infringed when she had brought the consequences on herself. That question could not be answered, said the Court of Appeal, until the fairness of the procedures and the proportionality of the sanction have been determined.

    However, the 'band of reasonable responses' test which, according to the case law such as A v B, requires a heightened standard to be adopted where the consequences of dismissal are particularly grave, adequately satisfies any Article 8 requirements as to procedure and thereby secures the benefit of the Convention right.

    Continuity of Employment


    [Thanks to Naomi Cunningham of Outer Temple Chambers for preparing this case summary]
    Are relations between employer and employee 'governed by a contract of employment' for the purposes of continuity after an offer of employment has been accepted, but before the employee has started work?

    Yes, says the EAT in Welton v Deluxe Retail Limited.

    Mr Welton worked at a shop in Sheffield. When the shop closed, he was dismissed.  During the following week, he agreed to accept employment at another shop owned by the same employer in Blackpool. He started work the week after that, and was dismissed a few months later.

    Langstaff P held that once the offer of new employment had been accepted, relations between the parties were governed by a contract of employment: it was not necessary for work actually to have started under the contract. That gave Mr Welton sufficient continuous employment to bring his claim.

    The President also held (obiter) that Mr Welton had in any event been absent on account of a temporary cessation of work. Mr Welton's final argument -  that continuity was preserved during his absence under section 212(3)(c) by an arrangement arrived at after the start of the new employment - failed. Such an arrangement could not be made retrospectively.

    The judgment is worth reading in full for its first-principles analysis of the contractual position - especially for anyone who missed the President's ELA Annual Lecture last week.

    Right to Legal Representation in Internal Disciplinary


    [Thanks to Angharad Davies of Dere Street Barristers for preparing this case summary]

    Is it unfair for a Claimant to not be permitted legal representation during an internal appeal hearing?

    Not necessarily, says the EAT in Ministry of Justice v Parry, unless the circumstances fall within an exceptional class of case in which the decision to dismiss from employment is also a decision which creates a legal barrier to the employee working again in their chosen profession, such that Article 6 ECHR guaranteed a right of legal representation at a disciplinary hearing.

    The Claimant was a District Probate Registrar and had a final written warning for gross misconduct, namely bullying and harassment. Further similar complaints were made within the currency of the warning. The complaints were upheld and the Claimant summarily dismissed.  The Claimant asked if she could be represented by solicitors at her appeal.  The request was declined but written submissions were prepared and considered by the Respondent.

    The EAT had to consider whether legal representation at the appeal was mandated and if so would a dismissal in the absence of such an opportunity be necessarily procedurally unfair. The EAT were referred to a number of authorities which demonstrated that a pragmatic, context-sensitive approach needed to be adopted to determine whether Article 6 was engaged.

    The EAT recognised that there was a contractual right to dismiss an employee but in some circumstances this decision could impact on an employee's broader civil rights: whether they could continue to work not simply in their role but in their chosen profession. In these circumstances where the employee's civil rights were engaged the guarantees provided by Article 6 must be observed. This was essential whether or not the decision regarding practice in their chosen profession would be taken at a later date by an external body. If there is a sufficient link between the internal proceedings and the determination of the employee's right to continue in their profession, Article 6 is engaged.

    The EAT held that the tribunal did not have sufficient evidence to decide whether Article 6 applied and therefore they were wrong to make the decision. The matter was remitted to a fresh tribunal.

    Tuesday 20 November 2012

    Facebook dismissal - court upholds traditional measure of damages


    [Thanks to Peter Taheri of 5 Essex Court for preparing this case summary]

    The High Court has handed down judgment awarding just £98 to the Claimant in Smith v Trafford Housing Trust; a breach of contract claim by a Claimant demoted for making comments on Facebook expressing his personal views on gay marriage. This case raises a number of issues:

    First, of interest is the reasoning on the factual issue of whether the Claimant had committed misconduct at all. Some of the points may well assist claimants in Facebook cases.

    Mr Smith's Facebook wall page identified him as an employee of the Trust. He had 45 work colleagues among his Facebook friends, including at least one who was offended by these comments. His wall was accessible by not just his 201 Facebook friends, but by friends of friends.

    In finding that the demotion was a breach of contract, the Court held that:

    1) No reasonable reader of Mr Smith's Facebook wall could rationally conclude that what he wrote about gay marriage was posted on the Trust's behalf. This was based on a reading of the wall as a whole, which included posts about sport, food and motor vehicles. It was clear that Mr Smith used Facebook for personal and social, rather than work related purposes.

    2) Encouraging diversity in the workforce inevitably involves employing persons with widely different religious and political beliefs and views, some of which, however moderately expressed, may cause distress among the holders of deeply held opposite views.  Such distress or offence is a necessary price to be paid for freedom of speech. Mr Smith's moderate expression of his personal views, on his personal Facebook wall at a weekend out of working hours, could not sensibly lead any reasonable reader to think the worst of the Trust for having employed him as a manager.

    3) Facebook had not acquired a sufficiently work-related context in this case to attract the application of the employer's disciplinary policies (even though those policies did to some extent cover conduct outside working hours and on Facebook). The Court distinguished this case from one of a targeted e-mail sent to work colleagues, or a case where work colleagues are invited to the pub for the purpose of religious or political promotion outside work; as Mr Smith's Facebook friends had each made a choice to be his friend on Facebook and so to seek his views.

    4) Mr Smith's postings on gay marriage were not, viewed objectively, judgmental, disrespectful or liable to cause upset, offence, discomfort or embarrassment. Nor were the manner and language in which he expressed his views.

    Second, it was held that the demotion, as a repudiatory breach of contract, constituted an actual dismissal, even though the employee claimed he had affirmed the employment contract, without waiving his right to damages for breach, by working at the lower grade under protest. Despite Mr Smith's argument that an "unaccepted repudiation is a thing writ in water", it was held that the original contract was at an end as Mr Smith had agreed to work in a different capacity for a greatly reduced salary under a new contract with the Trust. Unfortunately for Mr Smith, this was therefore held to be a case of wrongful dismissal.

    Third, damages for wrongful dismissal are limited to financial loss during the contractual notice period, which in this case was just £98 (the difference between earnings in the two jobs for the 12 weeks' notice period). Mr Smith's argument that the latter principle had been undermined by Durham Tees Airport v BMI Baby Ltd and anr did not succeed. As there was no unfair dismissal claim, the financial compensation awarded was very limited. This underlines the importance of bringing one's claim in time in the most appropriate tribunal.

    Friday 16 November 2012

    Statutory Dismissal Procedure


    [Thanks to James English of Samuel Phillips solicitors for preparing this case summary]
    Can a Claimant rely upon two letters, one sent before resignation and one after, as a grievance for the purposes of the now defunct statutory dispute resolution procedures?

    Yes, says the Court of Appeal in Dolby v Sheffield City Council.

    In a trip down memory lane for many practitioners, the Court of Appeal considered the statutory procedures under Part 2, Schedule 2 of the Employment Act 2002 and restored the employment tribunal's judgement that they had jurisdiction to consider a whistleblowing claim.

    In May 2008, the Claimant appealed the outcome of a Stage 2 meeting. Several days later, she wrote a further letter which referred to protected disclosures and detriments.  In July 2008, before the appeal hearing, she resigned.  In August 2008, her solicitors wrote on her behalf, and referred to constructive dismissal.

    Overturning the EAT decision, the Court of Appeal (adopting 'now discredited' over 'rebarbative' as their barbed epithet of choice) held that the two letters read together made the nature of the grievance clear. The fact one was sent after a Stage 2 meeting had been convened for an earlier grievance was irrelevant.

    Wednesday 14 November 2012

    Non Compliance with Unless Orders


    [Thanks to Simon McCrossan, squatter at New Walk Chambers, for preparing this case summary]
    When a party fails to comply with an 'Unless Order' does the employment tribunal possess any discretion to refuse to strike out a claim?

    No, says the EAT in Scottish Ambulance Service v Laing.

    Upholding the Respondent's appeal, Lady Smith held that an 'Unless Order' made under Rule 13(2) of the employment tribunal rules amounts to a conditional judgment, which will result in the automatic strike out of proceedings in the event of whole or partial non-compliance: "it is not open to a tribunal to revisit its decision that a failure to comply will result in strike out".

    In first instance, the tribunal had erred by applying the incorrect test under Rule 18(7) thereby incorrectly exercised its discretion in considering a variety of factors including the degree of compliance, fair notice and previous conduct which led to the eventual refusal (following further interim hearings) to strike out the Claimant's case on the grounds of insufficient particulars.  In any event, the EAT held that the Claimant failed to comply with the 'Unless Order' by the compliance date and that documentation considered after this time was not relevant for the purposes of striking out the claim.

    Permanent Health Insurance


    [Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]
    Can an employee dismissed for ill health sue for damages if he thereby loses benefits under a PHI policy?

    Not on the facts in Lloyd v BCQ Ltd, said the EAT.

    Mr Lloyd was dismissed because of ill health. One of his claims was that this was in breach of an implied term that the employer would not dismiss him if this had the effect of removing his entitlement to PHI benefit.

    In Aspden v Webb's Poultry and Meat (Holdings) Ltd Sedley J (as he then was) held that there was a term implied into the employee's contract that, notwithstanding an express term allowing for termination for prolonged sickness, this would not be exercised if it had the effect of depriving him of his PHI benefit in the absence of any fundamental breach by him. In Reda and another v Flag Ltd however, the Privy Council explained that Aspden was a case with special facts. On the evidence it was found that it had never been the employer's intention to exercise its contractual right of dismissal where to do so would frustrate the employee's entitlement to income replacement insurance. In Lloyd, however, no such background existed. And Mr Lloyd's contract contained an "entire agreement" clause. This was an express term and there was no scope for the implication of a term which contradicted it.

    In the alternative, the EAT held that if it were, in a given case, appropriate to imply a term restraining the exercise of the power of dismissal in this context, this could only be actioned where (per the Court of Appeal's view in Briscoe v Lubrizol) the dismissal was "without reasonable and proper cause". In this case, dismissal was for good cause because of the claimant's absence from work and lack of prospect of returning to work.

    Finally, in the event, Mr Lloyd had no claim as he received the equivalent of the PHI benefit and had suffered no loss.

    ECJ - Age Discrimination and Retirement


    [Thanks to Emma Price of Temple Garden Chambers for preparing this case summary]
    Is lowering the compulsory retirement age for judges from 70 to 62 justified age discrimination?

    No, says the CJEU in EC v Hungary, because it is not proportionate as regards the objectives pursued.

    The amendment gave rise to a difference in treatment based on age between persons within a given profession.  The aims of this amendment were legitimate: firstly, standardisation, in the context of professions in the public sector, of the age limit for compulsory retirement; and secondly, the establishment of a 'more balanced age structure' facilitating access for young lawyers to the professions of judge, prosecutor and notary and guaranteeing them an accelerated career.

    However, whilst the lowering of the retirement age was appropriate in pursuit of the first aim, it was not necessary considering the interests of those forced to retire early and the fact that the amendment was not gradually staggered.  The second aim was not appropriate as the short term effects of vacating numerous posts, which will be liable to be occupied by young lawyers, could not be said to achieve a truly balanced age structure in the medium and long term.

    Monday 12 November 2012

    TUPE Service Provision Changes


    [Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]
    Under TUPE, what is the interpretation of a contract for a 'single specific event or task of short term duration' for the purposes of determining whether there has been a service provision change?

    This issue was addressed by the EAT in Liddell's Coaches v Cook.

    Under TUPE, Reg 3(3)(a)(ii) a service provision change is excluded where the client for whom the services are provided intends that the activities concerned are in connection with a single specific event or task of short term duration.

    Liddell's had a contract to provide transport for schoolchildren during a limited period when they were 'decanted' from their school.  It was just for a year.  The evidence was that contracts of this nature were normally awarded for periods of between 3 and 5 years.  Did the exclusion apply?

    The employment tribunal held that the decant transport contract related to a single specific event and was of short term duration.  TUPE did not apply.  The EAT agreed with the result.  However, Lady Smith took the opportunity to analyse the exclusion.  The BIS guidance on TUPE indicates that both a single specific event, and task, must both be of short term duration.  Lady Smith disagreed.  The phrase could be construed disjunctively.  A single specific event spoke for itself. It did not necessarily have to be of "short term duration".  An event is an event. It does not require to be qualified by the words: "of short term duration". But in the outcome this did not matter.  The tribunal had correctly found that the contract (event or task) was, in this case, of short term duration.

    Fixed Term Contracts


    [Thanks to Michael Reed Employment Legal Officer at the Free Representation Unit for preparing this case summary]
    Does time worked under a training scheme count towards the four years a fixed-term employee needs to become permanent?

    No, held the Court of Appeal in Hudson v Department of Work and Pensions.

    The Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 say that anyone employed under a succession of fixed-term contracts will become a permanent employee after four years "unless employment on a fixed term contract is objectively justified".

    There is an exception for employees on a training / work-experience scheme arranged by the government or funded by the European Community.

    In 2006 Ms Hudson began a fixed-term contract under such a scheme at the DWP. This was extended several times until Ms Hudson became a Support Officer in 2009. This was also a fixed-term contract, but not part of a training scheme.

    In 2010 Ms Hudson argued that, having worked for more than four years under fixed-term contracts, she was a permanent employee. She was no longer working under a training scheme, so the exclusion did not apply.

    The Court of Appeal disagreed, concluding that time worked under a training scheme does not count towards establishing the four year period.

    ECJ - Age Discrimination and Retirement


    [Thanks to Emma Price of Temple Garden Chambers for preparing this case summary]
    Is lowering the compulsory retirement age for judges from 70 to 62 justified age discrimination?

    No, says the CJEU in EC v Hungary, because it is not proportionate as regards the objectives pursued.

    The amendment gave rise to a difference in treatment based on age between persons within a given profession.  The aims of this amendment were legitimate: firstly, standardisation, in the context of professions in the public sector, of the age limit for compulsory retirement; and secondly, the establishment of a 'more balanced age structure' facilitating access for young lawyers to the professions of judge, prosecutor and notary and guaranteeing them an accelerated career.

    However, whilst the lowering of the retirement age was appropriate in pursuit of the first aim, it was not necessary considering the interests of those forced to retire early and the fact that the amendment was not gradually staggered.  The second aim was not appropriate as the short term effects of vacating numerous posts, which will be liable to be occupied by young lawyers, could not be said to achieve a truly balanced age structure in the medium and long term.

    Thursday 8 November 2012

    Discrimination on grounds of Political Opinion


    [Thanks to Sarah Russell, solicitor at Russell, Jones and Walker, part of Slater & Gordon Lawyers, for preparing this case summary]
    Does the UK provide adequate protection from dismissal on the grounds of political party membership?

    No, said the European Court of Human Rights in Redfearn v UK.

    The Claimant was employed by Serco providing transport services for children and adults in Bradford.  He was elected as a Councillor for the BNP.  Serco summarily dismissed him, citing safety concerns about his risk of attracting attack.  The Claimant had insufficient service to bring an unfair dismissal claim.  His race discrimination claim failed.

    The ECtHR held that the lack of unfair dismissal protection interfered with his right to freedom of assembly under Article 11 of the ECHR.  There is an obligation to provide protection against dismissal motivated by an employee's membership of a political party, or at least to provide the means for an independent evaluation of the proportionality of such a dismissal.  This applied notwithstanding that the views of that party might be offensive, because of the importance of democracy.

    It may now be arguable that political views should be treated as incorporated into the definition of philosophical beliefs for the purposes of the Equality Act 2010.

    Wednesday 7 November 2012

    Deductions from wages

    [Thanks to Ed McFarlane of Deminos HR for preparing this case summary]
    Can individual clauses in an employment contract be construed in line with the principles of Autoclenz to establish the validity of a clause?

    No, says the EAT in Qantas v Lopez and Hooper.

    The Claimants, airline cabin crew, won tribunal claims for unlawful deductions from wages after a dispute over the payment of expenses, which were, for tax reasons, earmarked as allowances within salary. The EAT considered whether the principles of Autoclenz v Belcher (see bulletin on this here) meant that the Claimants' contracts should be construed so as to make their allowances payable on top of salary. The EAT upheld the appeal: it was not appropriate on the facts of this case to construe the individual clauses relating to allowances as allowing the payment of the allowances on top of salary, and there had been no unlawful deductions. There was no suggestion that the clauses themselves were sham clauses, and there was no need to depart from settled principles of construction.

    The EAT also held that the payments were 'expenses' within the meaning of S27(2)(b) ERA 1996 and were therefore excluded from the definition of 'wages' in S27(1), so there was no jurisdiction to hear the complaints. 'Expenses' covers a payment 'in respect of expenses', e.g. a generous mileage allowance, not only simple re-imbursement of costs incurred.

    The EAT also explored the application of misrepresentation and the non est factum doctrine to employment contracts.

    Tuesday 6 November 2012

    Restrictive Covenants and Fiduciary Duties


    [Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett. Thanks also to Caroline Field of Fox for preparing this case summary]
    Was there a breach of a non-solicitation clause and fiduciary duty, in a case where the former customers denied having been solicited?

    Yes, says the High Court in Safetynet Security Limited v Coppage, which found the Claimant's former customers to be "lying and acting under the control of [the defendant]" in denying solicitation.

    Mr Coppage was a director of the Claimant company (a security company). Within two days of his resignation, two customers had terminated their relationship with the Claimant in favour of a new company, which had not produced any marketing material and had no "shop-front". The start-up was incorporated by Mr Hadley, a trainee electrician who resigned from the Claimant company within an hour of Mr Coppage and had limited security experience. Disclosure revealed significant text and telephone traffic between the defendant and both Mr Hadley and the Claimant's customers, with whom the judge observed an "unusually close relationship" over a key period. This evidence was in direct contradiction with Mr Coppage's earlier correspondence.

    Even if the non-solicitation clause had been deemed unenforceable, solicitation may have been a breach of Mr Coppage's duty to avoid situations where his own interests conflict with the Claimant's interests.

    The case stresses the importance of credible testimony, which is consistent with what a witness has said on other occasions and contemporaneous documents.

    Apparent Bias


    [Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett.  Thanks also to Simon McCrossan Squatter, New Walk Chambers for preparing this case summary]
    Can an employment tribunal remain effective and lawfully constituted despite the revelation of circumstances which may have required members to recuse themselves on the grounds of 'apparent bias'?

    Yes says the EAT in Bhardwaj v FDA.

    In dismissing the appeal, it was held that the Appellant had been legally advised, informed of the material facts and afforded an appropriate period of time in which to make a free and unpressured decision. Therefore, by agreeing to continue (a position supported by the Respondent) and failing to make an application for recusal, the EAT ruled that the Appellant had waived her right to make such an application in future, which she could not go back upon.

    The Appellant's claims of 'apparent bias' concerned the appointment of two Respondents to her claim as members of the employment tribunal. The two Respondents were offered appointments prior to the commencement of the hearing and these were confirmed after the hearing had begun.  It was agreed that they would not sit until the current proceedings were resolved, but one of the Respondents fortuitously and momentarily came into contact with one of the lay members of the tribunal at a training event for employment tribunal members, which occurred when the hearing (although ongoing) had been adjourned.

    Whilst the Appellant complained that she had continued following disclosure of the above due to the financial pressures of self-funding, the EAT ruled that this did not prevent her waiver being free and fully informed notably by her counsel who himself sat as a part-time employment judge.

    Monday 5 November 2012

    TUPE - settlements


    [Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]
    In a TUPE transfer, does a settlement agreement with one employer automatically bar off claims against other actual or potential  Respondents?

    No, says the Employment Appeal Tribunal in Tamang v Act Security Limited

    When there is a TUPE transfer, there is often more than one employer in the frame.  This is particularly acute in service provision changes and in cases under TUPE regulations 13-16 (information and consultation) where, in the latter case, there is potential joint and several liability among the employers.

    On a service provision change concerning a security contract, an ACAS settlement agreement  releasing claims was entered into with the original employer, Reliance (now Securitas).   But this did not include two other potential parties, ACT Security Ltd and Euro Storage UK Ltd.  When the employees decided to prosecute claims against these other parties, were they prevented from doing so by the original compromise agreement?

    The employment tribunal said they could not sue.  It considered the agreement with Reliance was a release of all three tortfeasors (relying on Chitty on Contracts to the effect that a release by one debtor releases the others).

    The EAT held this was wrong.  On the true construction of the agreement this was a covenant not to sue Reliance, and not a release of all Respondents. Its scope only related to Reliance and not by implication to others.

    This shows how important it is for all potential parties in a TUPE transfer to be signed up to a settlement agreement if finality is required.