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Court upholds unfair dismissal appeal

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3rd Apr 2012
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The Court of Appeal has come to the rescue to clear up 17 years of ambiguity surrounding the issue of unfair dismissal claims.

Under TUPE legislation, the Transfer of Undertakings (Protection of Employment) Regulations 2006, the court ruled that liability for unfair dismissal claims automatically passes to any new employer - making businesses that have fired staff in anticipation of a transfer less attractive to potential buyers.

As reported in our sister title HRZone.co.uk new employers will still be liable, although any claim would have to be brought within three months.

The court confirmed it did not matter whether the new employer was known, had been identified or even contemplated at the time of the dismissal.

Spaceright Europe Ltd v Baillavoine

In the case of whiteboard manufacturer Spaceright Europe [Spaceright Europe Ltd v Baillavoine & Anor] the Court of Appeal moved to rule on decisions made by an employment tribunal and the Employment Appeal Tribunal against the former.

Mr Baillavoine was one of a number of employees who was dismissed by the administrators of the transferring company, Ultralon Holdings, prior to a TUPE transfer.

Baillavoine brought a claim against Ultralon’s eventual acquirer, SpaceRight Europe, alleging that he had been automatically unfairly dismissed for a reason “connected with the transfer”.

Both the employment tribunal and EAT agreed with him, but Spaceright appealed.

However, the Court of Appeal ruled that as a matter of ordinary English and “plain common sense”, dismissal prior to a transfer could be considered a reason “connected with the transfer”, even if the new employer was unknown.

This meant that Baillavoine’s dismissal was automatically unfair and his claim was upheld.

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