Bower v Stevens & Anor

Section 218(5) of the Employment Rights Act 1996 preserves continuity of employment when the membership of a partnership changes. It applies where a partnership of two is dissolved and the business continues with one former partner as sole principal. The expression “with the partners” can include employment with the partner who remains, in that partner’s former capacity. Purposive construction applies to statutes generally, regardless of whether they derive from European legislation. Section 218(2) may also apply where one former partner continues the business, but that issue was left undecided.

Mrs Stevens and Mr Marc were employees of Hughes Hooker, a solicitors’ firm in which Mr Bower and Mr Bielecki were partners. Mr Bielecki was struck off the roll on 6 March 2001, and the business closed on 30 March 2001. The employees brought claims including unfair dismissal and redundancy payments.

The Employment Tribunal found that they had been dismissed by Mr Bielecki and Mr Bower as partners. The Employment Appeal Tribunal held that the partnership had dissolved by operation of law but that continuity of employment was preserved under section 218(5) of the Employment Rights Act 1996. Mr Bower appealed on the construction of that provision.

1. Appeal dismissed. The employment of Mrs Stevens and Mr Marc continued until 30 March 2001, so their originating applications were in time. The appellant was ordered to pay the respondents’ costs on the standard basis, subject to detailed assessment in default of agreement. Permission to appeal to the House of Lords was refused.
2. Section 218(5) of the Employment Rights Act 1996 protects employees’ statutory rights despite changes in the personnel of a partnership or among personal representatives or trustees who employ them. Its purpose applies equally where two partners are succeeded by one of them as sole principal. “With the partners” may therefore mean with the partners or any one of them who was previously the employer in the relevant capacity.
3. Lord Justice Maurice Kay rejected the submission that purposive construction was unavailable because the provision pre-dated European legislation or had been consolidated. Purposive construction is available in construing statutes generally.
4. Lord Justice Maurice Kay respectfully disagreed with Sir John Donaldson’s analysis in Harold Fielding Ltd v Mansi [1974] ICR 347 and adopted the approach in Jeetle v Elster [1985] ICR 389. The Employment Appeal Tribunal was therefore right to find continuity under section 218(5).
5. Section 218(2) was also capable of applying where partners dissolved their partnership and one former partner thereafter carried on the business. Sections 218(2) and 218(5) were not mutually exclusive. The court did not finally determine the section 218(2) issue because it was raised late and the evidence was incomplete.
6. Lord Justice Longmore and Lord Justice Potter agreed with Lord Justice Maurice Kay.

• Court of Appeal (Civil Division): Appeal from the Employment Appeal Tribunal dismissed. Continuity of employment continued until 30 March 2001 under section 218(5) of the Employment Rights Act 1996.
• Employment Appeal Tribunal: Appeal from the Employment Tribunal dismissed. It held that the partnership had dissolved on 6 March 2001 but that section 218(5) preserved continuity of employment.
• Employment Tribunal: It found that the employees had been dismissed by Mr Bielecki and Mr Bower as partners of Hughes Hooker.