Gary Lewis v Dow Silicones UK Limited

The Employment Appeal Tribunal held that the Employment Tribunal erred in law by finding that the claimant had been fairly dismissed. The claimant had been treated as dismissed under regulation 4(9) of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006) because a transfer involved a substantial change in working conditions to his material detriment. Applying Kuzel v Roche, the EAT emphasised that the employer bears the evidential burden of proving the sole or principal reason for dismissal and that an Employment Tribunal cannot permissibly base a finding of a reason for dismissal on material that was neither pleaded nor evidenced by the employer.

Because the respondent had not pleaded or produced evidence that safety (or any other) reasons were the employer's reason for imposing the changes, the only proper conclusion on the material before the court was that the transfer of the undertaking was the sole or principal reason for the dismissal. The dismissal was therefore automatically unfair under regulation 7(1) TUPE 2006 and the matter was remitted to a fresh Employment Tribunal to determine remedy.

Background and parties: The claimant, an operations technician employed since 1999, transferred to the respondent under TUPE when the respondent purchased and then restructured operations at a Combined Heat and Power Plant. The claimant resigned, asserting constructive dismissal under regulation 4(9) TUPE 2006 and/or section 95(1)(c) Employment Rights Act 1996 (ERA), and claimed unfair dismissal including automatic unfair dismissal under regulation 7(1) TUPE 2006.

Procedural history:

• First Employment Tribunal dismissed the claimant's claim (judgment sent 24 December 2019).
• First appeal to the EAT (HHJ Shanks) succeeded on the regulation 4(9) point (10 December 2020), remitting the matter for remedy and further determination.
• On remittal, a different Employment Tribunal (Judge R Brace) concluded that the respondent had established that the transfer was not the sole or principal reason for dismissal and that an economic, technical or organisational (ETO) reason entailing changes in the workforce justified dismissal; the claim was dismissed (hearing 14–15 June 2022).
• The claimant appealed that second Tribunal decision to the EAT, resulting in the present judgment (12 April 2024).

Issues framed:

• Whether the Employment Tribunal had properly identified the sole or principal reason for the claimant's dismissal, and in particular whether the respondent had pleaded or evidenced any reason other than the transfer.
• Whether the Employment Tribunal could permissibly rely on a safety reason that had not been pleaded or evidenced by the respondent.
• Whether any established reason amounted to an ETO reason under regulation 7(2) TUPE 2006 and, if so, whether the dismissal was fair under section 98 ERA.

Court's reasoning: The EAT reviewed the pleadings, the remit from the earlier EAT decision, the evidence and the second Employment Tribunal's reasoning. It emphasised the principle from Kuzel v Roche that an employer who dismisses an employee must prove the reason for dismissal. The EAT found that the respondent had not pleaded safety as the reason for the change and had not produced evidence from which it could be concluded that safety was in fact the employer's reason at the time the change was imposed. The Employment Tribunal had relied primarily on the claimant's cross-examination and post-event material, which did not establish the respondent's mental state or reasons. Because the employer had not satisfied its burden, the only tenable conclusion was that the transfer was the sole or principal reason for the dismissal. The EAT therefore allowed the appeal, substituted a decision that the dismissal was automatically unfair under regulation 7(1), and remitted remedy to a new Employment Tribunal.

Additional points: The EAT noted that, had the respondent relied on an ETO reason it had not made out that defence on the material before the tribunal, and that no adequate consultation concerning any putative safety reason had been shown.

Appeal allowed. The Employment Tribunal erred in law by treating safety and organisational reasons as the sole or principal reason for dismissal where those reasons had not been pleaded or established by the respondent. Applying Kuzel v Roche, the EAT held that the respondent had not proved any reason other than the transfer and that the dismissal was therefore automatically unfair under regulation 7(1) TUPE 2006. The matter is remitted to a new Employment Tribunal to determine remedy.

First-instance Employment Tribunal dismissed the claim (judgment issued 24 December 2019). The claimant's first appeal to the Employment Appeal Tribunal (HHJ Shanks) succeeded on regulation 4(9) TUPE 2006 (decision 10 December 2020, UKEAT/0155/20/LA (V)), remitting the matter. On remittal the Employment Tribunal (Judge R Brace) dismissed the claim (hearing 14–15 June 2022). The claimant appealed again to the EAT, which allowed the appeal and remitted remedy to a fresh Employment Tribunal ([2024] EAT 51, 12 April 2024).