Reasons for Dismissal in TUPE

Hare Wines Ltd v Kaur and another

Ms Kaur was employed by a wine merchant which got into financial difficulties and was sold to another company.

All her colleagues continued to be employed by the new company though her employment ceased before the transfer. The reason given to her was they were ceasing to trade, However the new employer suggested that was because she didn't wish to transfer.

She contended that the principal reason for her dismissal was the transfer of the business, so it was automatically unfair under regulation 7 of TUPE. The new company's defence was that she had objected to the transfer, with the result that any liability for her dismissal remained with the previous employer.

She told the tribunal that her manager did not want her to transfer because they had a difficult relationship and so the new company did not want her to transfer. The tribunal accepted her account and decided the dispute in her favour. They accepted that she would have transferred if she hadn't been dismissed.

The decision was appealed to the Employment Appeal Tribunal who dismissed the appeal and upheld the Tribunal's finding that the reason for the dismissal was the transfer.

A further appeal was made to the Court of Appeal, which was also dismissed.

The Court held that

The company had given a false reason for Ms Kaur’s dismissal. The Tribunal had found that she had not objected to the transfer. There could be no appeal from that finding.

Also the dismissal had occurred on the day of the transfer. The dismissal occurring so close to the transfer was an important consideration when determining the reason for it.

The third difficulty for the company was that Ms Kaur's poor relationship between and her manager had existed for some time without anyone attempt to dismiss her. The fact that her employer had only dismissed her at the request of the company prior to takeover only gave rise to the rationale of her dismissal being the transfer and not the relationship.

Dismissals will be generally be considered to be automatically unfair if the sole or principal reason for the dismissal is the transfer itself, unless it can be shown that the dismissal is for an economic, technical or organisational reason which entails changes in the personnel. Each case will of course stand on their own facts. So where an employer believes it has reason for the dismissal which is not related to the transfer. even if it believes that this equates to a reason based on economic, technical or organisational grounds, must take special care if the dismissal is close to the date of transfer of the business .