V Clark v Kim Middleton & Anor

Under Transfer of Undertakings (Protection of Employment) Regulations 2006, a pre-transfer employee’s complaint about the transferor’s information duties lies against the transferor. A transferee’s failure to provide information under Regulation 13(4) creates no freestanding employee complaint. It may expose the transferee to an award only through the transferor’s successful statutory defence.

A claimant may compromise or relinquish that contingent remedy. An objectively expressed withdrawal of all claims against the transferee, followed by dismissal, may therefore prevent an award against it.

The transferor must identify the transferee as part of informing employees of the fact of the transfer. Knowing the identity of the future employer is fundamental. A failure to provide it is not merely technical and cannot properly attract a zero compensatory award on that basis.

The claimant worked for a microbusiness operated by Mrs Middleton as a sole trader. The undertaking transferred to Black Dog Hydrotherapy Ltd, a company formed by another employee. The claimant later resigned and brought a TUPE information-and-consultation complaint against Mrs Middleton, together with employment claims against the company.

Shortly before the tribunal hearing, the claimant settled with the company through ACAS, withdrew her claims against it, and they were dismissed. The Employment Tribunal upheld Mrs Middleton’s defence that the company had not informed her of proposed measures. It held that the dismissal prevented an award against the company and made no compensation award for Mrs Middleton’s failure to identify the transferee before transfer.

The claimant appealed. The central issues were the effect of the withdrawal on a contingent Regulation 15(8)(b) remedy, and whether a zero award for failure to identify the transferee was lawful.

1. The appeal was allowed in part. The Employment Tribunal was correct that the claimant could not obtain a Regulation 15(8)(b) award against the transferee after withdrawing all claims against it and procuring dismissal of those claims.

2. A Regulation 13 complaint concerning the transferor’s pre-transfer duties lies against the employer at the time of the alleged failure. There is no direct or freestanding complaint against a transferee for failure to supply the transferor with information under Regulation 13(4): Allen v Morrisons Facilities Services Limited [2014] IRLR 514. The transferee’s potential liability under Regulation 15(8)(b) is contingent upon a complaint against the transferor and its successful reliance on that failure.

3. That contingent right may nevertheless be settled or relinquished. The withdrawal email, read objectively in its context, withdrew all claims against the transferee under the case number without reserving the contingent Regulation 15(8)(b) remedy. The subsequent dismissal reinforced that result. The tribunal therefore did not err by declining to make an award against the transferee.

4. The tribunal erred in suggesting that the claimant could instead have brought a direct Regulation 13 complaint against the transferee. Nor did Regulation 13 impose a post-transfer duty on the transferee to inform or consult the claimant about measures affecting her in the manner contemplated by the tribunal: Amicus v City Building (Glasgow) LLP [2009] IRLR 253.

5. The tribunal did not err by failing to make further findings about legal, economic and social implications under Regulation 13(2)(b), since no distinct particulars of such a failure had been advanced.

6. However, the transferee’s identity was information required by Regulation 13(2)(a). It is an essential aspect of informing an employee that a transfer will take place. An employee’s knowledge of the legal person who will become the employer is fundamentally important. The tribunal therefore erred by treating the failure as a very technical breach and making a zero award, although it could take the other mitigating circumstances into account.

7. The zero award was quashed. The assessment of compensation for failure to notify the claimant of the transferee’s identity was remitted to a differently constituted tribunal.

• Employment Appeal Tribunal: appeal allowed in part. The award issue was remitted to a differently constituted Employment Tribunal.
• Employment Tribunal: dismissed the claimant’s claim for a 13-week TUPE award after making a zero award for the transferor’s failure to identify the transferee. Its decision was varied on that issue.