Case law: Court ruling highlights dangers of dismissing an employee close to TUPE transfer
Employers should not dismiss employees close to a TUPE transfer without taking specialist legal advice, or risk the dismissal being found automatically unfair.
This update was published in Legal Alert - April 2019
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An employee was dismissed on the same day that the business she worked for was transferred to a new owner, in circumstances where the TUPE rules applied. She was the only employee dismissed. The employer argued that the reason for the dismissal was a strained and difficult relationship between the employee and a co-worker which had lasted for several years. The co-worker was to become a director of the new limited company employer to whom the business was transferred.
The TUPE rules are designed to protect employees, by preserving their jobs and their terms and conditions of employment, when a business or undertaking they work for is transferred from their current employer to a new one. If an employee can successfully argue that their dismissal was because of the TUPE transfer, it is automatically unfair in law unless it is shown the dismissal is for an economic, technical or organisational reason involving changes in the workforce.
This means that, in practice, it is risky for an employer to dismiss an employee around the time of such a transfer.
Here, the Employment Tribunal ruled that the real reason for the dismissal was the transfer - there was a strong inference that the employee was dismissed because the new owner did not want her on its payroll because of the poor relationship. This meant she had been automatically unfairly dismissed.
The EAT warned that when working out whether the fact the dismissal is so near the transfer, 'proximity to the transfer is not conclusive' - but is 'often strong evidence in the employee's favour'.
- Employers should not dismiss employees in close proximity to a TUPE transfer without taking specialist legal advice, or risk the dismissal being found to be automatically unfair.
Case ref: Hare Wines Ltd v Kaur & Anor  EWCA Civ 216
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