Successful appeal against employee dismissal: what does this mean in a TUPE context?
February 10, 2015
(Salmon v Castlebeck Care)
Mrs Salmon worked for Castlebeck Care Ltd (Castlebeck), until 10 July 2013 when she was dismissed for gross misconduct. Following this, she launched an appeal.
A few months later, on 4 September 2013, Castlebeck was transferred to Danshell Healthcare Ltd (Danshell).
On 17 September, Mrs Salmon’s appeal was heard by Castlebeck’s HR Director, whose employment had TUPE transferred to Danshell. The HR Director upheld the appeal, but did not take steps to communicate the decision to reinstate Mrs Salmon, or even make her aware that her contract had been reinstated.
As Mrs Salmon was not aware of the outcome of her appeal, she brought unfair dismissal proceedings against both Castlebeck and Danshell. The employment tribunal upheld her claim against the former, but dismissed her claim concerning the latter, reasoning that Mrs Salmon had never been employed by Danshell. Mrs Salmon subsequently appealed to the Employment Appeal Tribunal (EAT), arguing that her employment had automatically been transferred to Danshell under Regulation 4(3) of TUPE and that Danshell’s behaviour could be seen as dismissing her from her position.
The EAT allowed the appeal and upheld it, whilst also discharging the tribunal’s decision against Castlebeck. The EAT held that the tribunal had erred in concluding that Mrs Salmon’s contract had not been reinstated as a result of the events that had taken place, and had erred in holding that the outcome of the appeal needed to be communicated to be effective. It was decided that Mrs Salmon was employed immediately prior to the transfer, due to the appeal decision. As a result, her claim was against Danshell, and once the appeal succeeded, Mrs Salmon’s employment position was reinstated regardless of whether she was notified by her employer.
Simon Horsfield Says: This case highlights the importance of doing full due diligence and considering all of the employee liability information which is disclosed in the lead up to a TUPE transfer. If an employee has been dismissed shortly before the transfer but has an appeal outstanding which has the potential to be upheld, consideration needs to be given to who should hear the appeal and the consequences of upholding it. Ideally, indemnities should be obtained to protect the transferee from inheriting any surprise liabilities in this regard.