TUPE Dismissals

[Thanks to Dr John McMullen of Durham University for preparing this case summary]

The EAT (HHJ Richardson presiding) has handed down its judgment in Spaceright Europe Ltd. v Baillavoine which stands for the proposition that, in order for a dismissal to be automatically unfair under regulation 7 (1) of the Transfer of Undertakings (Protection) Protection) Regulations 2006 (prohibited dismissal by reason of the transfer), it is not necessary for the transferor to have a specific transferee in contemplation.

In the case, the claimant was managing director of a business which was up for sale. Although no transferee (buyer) had been identified, a view had been taken that an incumbent managing director was too expensive for a purchaser and he was dismissed, ostensibly on ground of redundancy. This, the employment tribunal held, connected the dismissal to the ultimate transfer for the purposes of Reg 7 (1) and made the dismissal unfair. In this regard the EAT followed Harrison Bowden v Bowden [1994] ICR 986 in preference to Ibex Trading v Walton [1994] ICR 907.

The EAT also considered, given the dismissal was by reason of the transfer, was there an economic, technical, or organisational (ETO) reason for the dismissal which entailed changes in the workforce which would render a transfer connected dismissal not automatically unfair? It held that the employee was a managing director and that there was a continuing need for that role. As such, there could not be an ETO for the dismissal.