Industrial Tribunals Northern Ireland Decisions

THE INDUSTRIAL TRIBUNALS

 

CASE REF: 720/15

 

 

 

CLAIMANT: Kathleen Hand

 

 

RESPONDENT: Robert O'Reilly

 

 

 

DECISION

The unanimous decision of the tribunal is that:

 

(a) The claimant's holiday pay claim is well-founded and it is ordered that the respondent shall pay to the claimant the sum of £476 in respect of holiday pay.

 

(b) The claimant's claim for notice pay is well-founded and it is ordered that the respondent shall pay to the claimant the sum of £960 in respect of notice pay.

 

(c) The claimant's redundancy pay claim against the respondent is well-founded and it is declared that the respondent is liable to make a redundancy payment of £1,573 to the claimant.

 

(d) The claimant's unfair dismissal claim was withdrawn and accordingly it is dismissed.

 

Constitution of Tribunal:

Employment Judge: Employment Judge Buggy

Members: Mr S Devlin

Mr I Rosbotham

 

Appearances:

The claimant was self-represented.

The respondent was not present nor represented.

 

REASONS

 

1. Throughout a continuous period, which began on 26 April 1996 and which ended on 7 January 2015, the claimant was working as an employee and, in that capacity, throughout that entire period, this respondent was always the claimant's line manager or supervisor.

 

2. The claimant was first employed by Eurofibres Ltd ("Eurofibres"); then, without any intervening break, she became an employee of Eurofibres (Ireland) Ltd ("EIL"); then, without any intervening break, she became an employee of O'Reilly Bedding Supplies Ltd ("O'Reilly BS"); then, without any intervening break, she became an employee of Dormir Beds Ltd ("Dormir"); and then, without any intervening break, she became an employee of the respondent.

 

The claims and the defences

 

3. The claimant says that she was dismissed, because of redundancy, by the respondent in these proceedings. The claimant currently makes claims in respect of holiday pay, notice pay and redundancy pay. (She had been making a claim in respect of unfair dismissal, but that claim was withdrawn during the course of this hearing.) According to the claimant, in the calculation of her notice pay and redundancy pay, she is entitled to be treated as a person who has had continuity of employment throughout the period from April 1996 until January 2015.

 

4. The respondent contends that the claimant was not dismissed and that, instead, she resigned. Alternatively, he contends that this claimant was not dismissed by reason of redundancy. The respondent also contends that there was no continuity of employment between the various employments of the claimant during the period up to the date on which she first became employed personally by the respondent (which was May 2014). For the latter reason, according to the respondent, the claimant is not entitled to a redundancy payment; and, for the same reason, she should be treated, for notice pay purposes, as though she was employed for less than one year.

 

The issues

 

5. Accordingly, for present purposes, the key issues are as follows:

 

(1) Did the claimant resign or was she dismissed?

 

(2) If she was dismissed, was she dismissed by reason of redundancy?

 

(3) Can the claimant be regarded as having continuity of employment, between some or all of her various employments, during the period beginning in 1996 and ending in January 2015, in light of the requirements of the Transfer of Undertakings (Protection of Employment) Regulations (Northern Ireland) 2006 ("TUPER")?

 

The process

 

6. Mr Colum Patrick Murphy is also an ex-employee of this respondent. His employment came to an end in January 2015. The context of his various employments (in businesses in which this respondent was his manager/supervisor) and the context of the termination of his employment, were similar to the equivalent contexts of this case. Accordingly: (1) The main hearing of the Murphy case was conducted alongside the main hearing of this case. (2) The evidence presented in the Murphy case was treated as evidence which had been presented in this case, and the evidence presented in this case was treated as evidence which had been presented in the Murphy case.

 

7. The respondent was not present or represented at this main hearing. We were unaware of any "good" reason for his absence. We therefore decided to dispose of the proceedings in the absence of the respondent. In doing so, we took account of any information in the possession of the tribunal which had been made available by the parties.

 

The facts

 

8. Both the claimant and Mr Murphy provided sworn oral testimony. We considered them to be honest witnesses.

 

9. In the following sub-paragraphs, we set out findings of fact which are relevant to the issues which we have had to determine in this case. (For ease of reference, and in the interests of minimising avoidable duplication, we have included some additional findings of fact elsewhere in this Decision):

 

(1) In determining the issues which have had to be determined in the present case, we have made the same findings of fact as those which are specified at sub-paragraphs (1)-(16) of paragraph 9 of the Decision in Murphy v O'Reilly (192/15). He Decision in Murphy is also being issued today).

 

(2) We noted that, in his Response, the respondent denies that the claimant was dismissed. However, even on the basis of the version of events which is set out at paragraphs 6.2 and 7 of the Response, it seems to us that the implication is that she was being dismissed.

 

(3) We consider that the claimant's account of events, at paragraph 7.4 of her claim form, is accurate. We note that, during the course of that paragraph, she gave the following account of events:

 

"When I returned to work on 7 January at 9.30 am I drove in the gates of work, I went to go into the office but the outside door was locked, (which has never been locked before) I then called to [the respondent's] house which is beside the office, he asked me to come into the house and sit down. He said he was not re-opening as he couldn't afford to pay wages, and funding he had applied for wasn't coming through. ...".

 

Liability : The law and our conclusions

 

10. Under this heading, the main issues are as follows:-

 

(1) Was the claimant dismissed?

 

(2) If so, was she dismissed by reason of redundancy?

 

(3) In the circumstances of this case, do the TUPE Regulations have the effect of entitling the claimant to be regarded as having been in continuity of service, ever since 2000, for the purpose of deciding whether she had enough service to claim a redundancy payment, and also for the purpose of deciding on the extent of her notice entitlement.

 

11. First, we deal with the "dismissal" issue.

 

12. To the extent there are differences between the claimant's version of events and the respondent's version of events, in respect of the circumstances of the termination of the claimant's contract of employment, we prefer the claimant's version of events. We are sure that, during the conversation on 7 January, the respondent told this claimant that she was being dismissed.

 

13. The second issue is whether or not the claimant's dismissal was by reason of redundancy. Against the following background, and for the following reasons, we have concluded that the dismissal was indeed by reason of redundancy.

 

14. In these proceedings, the claimant is making a reference to this tribunal, under Article 198 of the Employment Rights (Northern Ireland) Order 1996 ("ERO") for a declaration of her entitlement to a redundancy payment. Paragraph (2) of Article 198 provides that, for the purposes of an Article 198 reference, an employee who has been dismissed by her employer shall, unless the contrary is proved, be presumed to have been dismissed by reason of redundancy.

 

15. The contrary has not been proved in this case. Indeed, the reason for the dismissal which was mentioned to the claimant by the respondent on 7 January 2015 (that he was "not re-opening") is a reason which comes comfortably within the definition of redundancy, as set out in Article 174 of ERO.

 

16. The third of the liability issues was the TUPE issue. That is the most complex liability issue. We deal with that issue at paragraphs 17-49 below. (The contents of paragraphs 17-48 below are identical to the contents of paragraphs 17-48 of the Murphy Decision, which has already been referred to above).

 

17. The Transfer of Undertakings (Protection of Employment) Regulations 2006 have already been defined, for the purposes of this Decision, as "TUPER". Those Regulations implement the EU Acquired Rights Directive of 2001 ("the Directive").

 

18. TUPER applies to a "relevant transfer" within the meaning of those Regulations.

 

19. Regulation 4(1) of TUPER is important in the present context. The effects of a relevant transfer, on the contract of employment of any person who, immediately prior to that transfer, was assigned to the transferred entity, can be summarised as follows. (1) Other than in situations which are irrelevant in the present context, the relevant transfer does not operate so as to terminate the contract of employment of that employee. (2) Instead, after the transfer, any such contract has effect, as if it had originally been made between that employee and the transferee.

 

20. Put in different terms, the relevant effects of paragraph (1) of Regulation 4 of TUPER are as follows:

 

(1) If there was a relevant transfer (within the meaning of TUPER) from Eurofibres to EIL, Mr Murphy's and Ms Hand's respective contracts of employment, after that transfer, will be treated as though they had been originally made with EIL at the time when Eurofibres actually entered into the relevant contract of employment with Mr Murphy/ Ms Hand:

 

(2) If there was a relevant transfer from EIL to O'Reilly BS, the contract of employment of Mr Murphy and Ms Hand respectively will be regarded, as a matter of law, as having originally been made with O'Reilly BS.

 

(3) If there was a relevant transfer from O'Reilly BS to Dormir, the contract of employment of Mr Murphy, and the contract of employment of Ms Hand, will be regarded, as a matter of law, as having originally been made between Mr Murphy/Ms Hand and Dormir.

 

(4) If there was a relevant transfer between Dormir and the respondent, Mr Murphy's/Ms Hand's contract of employment with this respondent will be regarded, as a matter of law, as having been made with this respondent at the time when that contract was actually made with Dormir.

 

21. The implication of all this is that, if the four relevant transfers (within the meaning of TUPER) did occur, Ms Hand will have deemed continuity of service dating back to 2000.

 

22. The transfers referred to in the last preceding paragraph above were as follows:

 

(1) a transfer from Eurofibres to EIL;

 

(2) a transfer from EIL to O'Reilly BS;

 

(3) a transfer from O'Reilly BS to Dormir; and

 

(4) a transfer from Dormir to the Agencies.

 

23. For the purpose of TUPER a "relevant transfer" is defined as applying to a transfer of an entity (an undertaking, business or a part of an undertaking or a part of a business) "to another person" where there is " ... a transfer of an economic entity which retains its identity".

 

24. TUPER has to be construed in light of the requirements of the Directive. Subject to certain exceptions which are irrelevant in the present context), Article 1 of the Directive provides that it is to apply to any transfer of an entity "to another employer as a result of a legal transfer or merger" which are irrelevant in the present context. Article 1(b) provides that subject to certain exclusions, there will be a transfer within the meaning of the Directive if there is a transfer of an economic entity which retains its identity.

 

25. Regulation 3(2) of TUPER defines "economic entity" as an organised grouping of resources which has the objective of pursuing an economic activity. The same definition of an economic entity is to be found in Article 1 of the Directive. (That provision, in Article 1, reflects the case law of the European Court of Justice which had developed during the period leading up to the enactment of the 2001 Directive.)

 

26. As Regulation 3(6) of TUPER makes clear, for the purposes of the Regulations, a relevant transfer may take place even if no property is transferred within the context of that transfer.

 

27. We are sure that if any of the situations referred to at paragraph 22 above constituted a transfer within the meaning of the Directive, there was a relevant transfer for the purposes of TUPER.

 

28. Spijkers v Gebroeders Benedik Abattoir CV [1986] ECR 1119 sets out the criteria which have to be considered in deciding whether or not there has been a transfer for the purposes of the Directive.

 

29. At paragraph 11 of its judgment in Spijkers, the European Court of Justice stated that:

 

" ... the decisive criterion for establishing whether there is a transfer for the purposes of the Directive is whether the business in question retains its identity."

 

30. At paragraph 12 of that judgment, the Court declared that the implication of that decisive criterion (the question of whether or not the business retained its identity) was that, for the purposes of the Directive, a transfer does not occur merely because the assets of a particular business are disposed of; instead, according to the Court, what really matters is whether or not the business was disposed of as a going concern (whether or not, in the hands of the putative transferee, the business retained its identity).

 

31. Also at paragraph 12 of that judgment, the Court pointed out that one relevant indicator (one indicator that the business was disposed of as a going concern and had retained its identity) would be provided by the fact, if indeed it be the fact, that (1) the operation of the business was actually continued or resumed by the new employer and (2) it was continued or resumed with the same or similar activities.

 

32. At paragraph 13 of Spikjers, the Court made the point that there has to be an overall assessment on the question of whether or not the business has been disposed of to the putative transferee as a going concern. In that paragraph, the Court drew attention to certain factors which could properly be taken into account in arriving at that overall assessment. (However, the Court also made the point that those factors are only appropriate for consideration as part of an overall assessment, and that " ... they cannot therefore be considered in isolation".)

 

33. The factors to which the Court drew attention (at paragraph 13 of the Spikjers judgment) were as follows:

 

(1) The court or tribunal was to pay regard to the type of undertaking or business which is involved.

 

(2) Were the tangible assets of the business, such as buildings and movable property, transferred to the transferee?

 

(3) What was the value of the intangible assets (such as goodwill) of the business at the time of the transfer?

 

(4) Were the majority of the employees of the business taken on by the new employer?

 

(5) Were the customers of the old employer transferred to the new employer?

 

(6) How similar were the activities carried on before and after the putative transfer?

 

(7) Were those activities suspended for any period?

 

34. In relation to each of the situations listed at paragraph 22 above, we have had regard, in deciding whether or not there was a relevant transfers to the list set out in the last preceding paragraph, while bearing in mind that the listed factors can only appropriately be considered as part of an overall assessment.

 

35. We are sure that there was a transfer from Eurofibres to EIL. In light of all of our findings of fact, we have arrived at that conclusion against the following background and for the following reasons.

 

36. EIL, like Eurofibres, was run from the same office. EIL, like Eurofibres, used the same warehouse. All of the employees of Eurofibres were taken on by EIL. EIL had the same circle of customers as Eurofibres. The activities carried on before and after the putative transfer were essentially the same. Those activities were not suspended for any period.

 

37. We have concluded that there was a relevant transfer from EIL to O'Reilly BS. In light of all of our findings of fact, we have arrived at that conclusion, against the following background, for the following reasons.

 

38. Both businesses were run from the same office. Both businesses were using the same warehouse. Both businesses had essentially the same workforce. The customer-base of both businesses were much the same. Their respective activities were practically identical. The activities were not suspended for any period prior to the putative relevant transfer.

 

39. We are sure that there was a relevant transfer between O'Reilly BS and Dormir. In light of all of our findings of fact, we have arrived at that conclusion, against the following background, and for the following reasons.

 

40. We noted that the activities which were carried out by O'Reilly BS and the activities carried out by Dormir were not the same. We also noted that there were significant similarities between the two sets of activities. (Eurofibres, EIL and O'Reilly BS had been in the business of supplying components for bed makers; Dormir made the actual beds.)

 

41. We also noted that Dormir did not use the warehouse which had been used by Eurofibres, EIL and O'Reilly BS. However, we noted that Dormir used the same office as O'Reilly BS had used. We also noted that Dormir employed a majority of the people who had previously been employed by O'Reilly BS.

 

42. We noted that Dormir, like O'Reilly BS, used the same Mercedes van and the same forklifts.

 

43. We noted that the circle of customers of Dormir was very significantly different from the customer base of O'Reilly BS.

 

44. We are sure that, in May 2014, there was a relevant transfer from Dormir to the respondent. In light of all of our findings of fact, we have so concluded, against the following background and for the following reasons.

 

45. The Agencies' business was in precisely the same line of work as Dormir's business.

 

46. The Agencies used the same office as that which had been used by Dormir. Like Dormir, the Agencies used the same Mercedes van, and used the same forklifts.

 

47. The Agencies had essentially the same circle of customers as the circle which Dormir had had.

 

48. There was no gap between the termination of Ms Murphy's and Ms Hand's periods of employment with Dormir and the start of their respective period of employment by the respondent.

 

49. In light of the foregoing, we are satisfied that each of the changes-of-employer listed at paragraph 2 above constituted a relevant transfer. Accordingly, because of TUPER, the claimant is entitled to make a claim for a redundancy payment and is to be deemed, for notice pay calculation purposes, to have been employed by this respondent from the year 1996 onwards.

 

Amounts : The law and our conclusions

 

50. In calculating the amounts of notice pay and redundancy pay, we have taken account of the continuity of service which became available to the claimant because of the various TUPE transfers : See above.

 

51. This Decision is based on the following information:

 

Gross weekly pay : £85

Net weekly pay : £80

Number of actual completed years of service : 18

Age on date of dismissal : 42

Multiplier (for redundancy pay) : 18.5

 

The time-limit issue

 

52. In respect of claims for wages, holiday pay and notice pay, the time-limits are provided in Article 7 of the Industrial Tribunals Extension of Jurisdiction Order (Northern Ireland) 1994. Article 7 of that Order provides that, as a general rule, an industrial tribunal is deprived of jurisdiction to entertain a wages claim, holiday pay claim unless it is presented within the period of three months beginning with the effective date of termination of the contract of employment giving rise to the claim. (That is the primary relevant time-limit). However, Article 7 goes on to provide that, where the tribunal is satisfied that it was not reasonably practicable for the complaint to be presented within the primary time-limit, the tribunal can still entertain the claim if it was presented within such further period as the tribunal considers reasonable.

 

53. In this case, the position was as follows.

 

(1)           The effective date of termination of the claimant's contract of employment was 7 January 2015.

 

(2)           The claimant's duly completed paper claim form was not received at the Office of the Industrial Tribunals until 10 April 2015.

 

54. Having received evidence from the claimant, and having seen a copy of an email which the claimant sent to the Office of the Industrial Tribunals at 11:53 on 7 April 2015, we are sure that the claimant had tried unsuccessfully to electronically submit her claim form by the Office of the Industrial Tribunals website over the previous ten days. We are therefore satisfied that, although the wages, holiday pay and notice pay claims were not presented within the relevant primary time-limit, it was not reasonably practicable to do so.

 

55. As already noted above, the claimant lodged a paper version of the claim form by 10 April. In those circumstances, we are sure that the claimant met the relevant secondary time-limit, because she lodged the paper claim form within such "further period as the tribunal considers reasonable".

 

Interest

 

56. This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

 

 

 

 

 

Employment Judge

 

 

Date and place of hearing: 28 May 2015, Belfast

 

 

Date decision recorded in register and issued to parties: