TUPE transfers and the effect of appeals against dismissal and reviving the contract of employment

31st January 2015 It is established law that a successful appeal against dismissal revives the contract of employment. In addition the employee will be entitled to backdated pay and benefits. However, is the employer obliged to inform the employee of the revival of the contract for it to effectively be revived. The Employment Appeals Tribunal (EAT) has recently said that the revival will take effect even if the employer fails to notify the individual of this fact.

The case of Salmon v Castlebeck Care concerned a transfer of business under TUPE. Those regulations have the effect of automatically transferring the employment of an employer from the old owner of the business to the new owner if the employee was in the employment immediately before the transfer took place. The question therefore arose about whether an individual was an employee at the date of the transfer or not. The employee, Mrs Salmon had been dismissed for gross misconduct while employed by the "old" employer. She appealed against the dismissal. The transfer took place, and shortly after that the HR Director concluded that her dismissal had been unsafe. That decision was not communicated to Mrs Salmon at that point. The EAT concluded that the contract was revived as soon as the decision was taken to overturn the dismissal on the appeal being successful. It concluded that the revival took effect even without having to communicate this to Mrs Salmon. Therefore she had been transferred from the "old" employer to the "new" employer under the TUPE transfer which had taken place between the date of her dismissal and the date of the successful appeal against dismissal.

This case highlights a potential risk to businesses that are buying other businesses and that will inherit the staff of the old owner under TUPE. It emphasises the need for questions to be asked in the due diligence process abut recently dismissed staff and appeal and the state of such appeals.

If you need assistance on this matter we can give you the guidance you need to deal with this issue at Hallett Employment Law Services Ltd