Employment Law Cases

Hare Wines Ltd v Kaur

The dismissal of an employee on the day of a TUPE transfer because her new employer foresaw ongoing problems with a fellow employee was automatically unfair under TUPE.

The dismissal of an employee is automatically unfair if the sole or principal reason for it is connected with a business transfer - unless it is for an economic, technical organisational (ETO) reason entailing changes in the workforce (reg. 7 of TUPE).

Background

Mrs Kaur worked as a cashier for H&W. She had a long-standing and difficult working relationship with a colleague, Mr Chatha, with equal animosity on both sides. On 11 December there was a TUPE transfer to Hare Wines. Mr Chatha was due to become a director of Hare Wines post-transfer. All H&W staff transferred to Hare Wines, except Mrs Kaur. She was told without warning two days before the transfer that she was being dismissed. She brought proceedings against both H&W and Hare Wines. To obtain any meaningful remedy she had to succeed against Hare Wines (as H&W had ceased to trade) and for that she needed to show that her dismissal fell under reg. 7.

Hare Wines argued that she had objected to being transferred because of the difficult working relationship with Mr Chatha. This sat oddly with H&W’s written dismissal of her and its payment of part of her notice. The tribunal and EAT rejected this argument, finding that it was Hare Wines’ concerns about the on-going working relationship that led to the dismissal. The reason for the dismissal was the transfer and it was automatically unfair. Hare Wines appealed – on the basis that the existence of purely personal reasons precluded the transfer from being the reason for the dismissal.

Court of Appeal decision

The appeal was dismissed.

Three obstacles stood in the way of the appeal:

1. The tribunal had rejected evidence that Mrs Kaur had objected to being transferred. She had plainly been dismissed.
2. The proximity of her dismissal to the transfer, which was strong evidence in her favour. Although proximity alone is not conclusive, it is often strong evidence in the employee’s favour.
3. As no action had been taken to address the poor working relationship before the transfer, there was a strong inference that it was the transfer, rather than the poor relationship in isolation, that resulted in her dismissal. The difficulties in the working relationship were long standing and ongoing. Mrs Kaur’s difficulties did not arise just on the point of transfer and were not going to end just afterwards.

The tribunal was entitled to find that Hare Wines anticipated on-going difficulties in the working relationship and decided as a result that it did not want her employment to transfer. It was the transfer that made the difference between the problems in the working relationship being tolerable and not.

Link to judgment: https://www.bailii.org/ew/cases/EWCA/Civ/2019/216.html

Comment

If you are dismissing employees around the time of a TUPE transfer, tread carefully. Where there is no economic, technical or organisational (ETO) reason for a dismissal (which must always result in changes to the workforce), consider carefully whether it is possible for a tribunal to conclude that the transfer is the reason for the dismissal. Even if an issue affecting an employee’s conduct (which would not normally be transfer related) was suddenly acted upon on the point of transfer, the transfer might well be found to be the sole or principal reason for the dismissal. The closer the dismissal is to the transfer date, the greater the risk will be of a finding of an automatically unfair dismissal.