Was a TUPE procedure used to unlawfully dismiss an employee?
The case of Hare Wines Ltd v (1) Kaur (2) H&W Wholesale Ltd centres around the Transfer of Undertakings (Protection of Employment) Regulations, commonly known as TUPE, and whether an employer unlawfully used this procedure as a way of getting rid of a problem employee. The employee in this case, Ms Kaur, had originally worked as a cashier for a wine and beer wholesale business, H&W Wholesale Ltd. When this business entered financial difficulty it was purchased by Hare and Wines Ltd who, under the TUPE regulations, became the recognised ‘transferee’. As part this, the TUPE procedure required all of the employment contracts to be transferred to Hare Wines Ltd. Two days before the transfer, a discussion was held between the employee and the old employer regarding the new business. At the end of this meeting, Kaur had her employment terminated due to what was described as ‘unforeseen financial difficulties’ which meant the business ‘ceased to trade’. Kaur proceeded to lodge a claim with an employment tribunal (ET) for automatic unfair dismissal under Regulation 7 of TUPE, believing that the sole reason for her dismissal was the transfer itself. The employer, meanwhile, argued that Kaur could be treated as having resigned due to her objecting to the transfer in accordance with Regulation 4 of TUPE. The ET heard two contrasting versions of events, with Kaur claiming she had simply raised concerns regarding a colleague who would be managing her going forward, whilst the employer claimed she had explicitly refused to work for the new company. Ultimately the ET agreed that, on balance, they preferred Kaur’s version of events and concluded that the employer anticipated that there may be a difficult working relationship between Kaur and her colleague in the future, and proceeded to dismiss her on this basis. The employer subsequently appealed this decision to the Employment Appeal Tribunal (EAT), arguing that the reason for Kaur’s termination was personal, based on the poor working relationship, and not because of the TUPE transfer. However, the EAT dismissed this appeal and agreed with the initial ET that the transfer was the principal reason for the dismissal. In making their decision, the EAT placed significant emphasis on the timing of the dismissal, coming just two days before the proposed transfer, and how this was an indication of the employer’s ulterior motive. They also found, based on the facts, that both Hare Wines Ltd and the colleague who was set to be Kaur’s manager did not wish for her to transfer and this was the primary reason for the dismissal. This case reminds employers of the protections which staff are afforded under the TUPE regulations, specifically that employees have the right to transfer over to the new employer with their role intact providing they meet certain criteria. Try as they might, employers cannot modify this procedure to simply pick which individuals they wish to take and it will be up to the transferee to manage any existing performance issue or workplace disputes once the transfer is completed.