United Kingdom Employment Appeal Tribunal

You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> McCoid v Commercial & Maritime Ltd & Anor [1991] UKEAT 1_90_1112 (11 December 1991)
URL: http://www.bailii.org/uk/cases/UKEAT/1991/1_90_1112.html
Cite as: [1991] UKEAT 1_90_1112

[New search] [Printable RTF version] [Help]

BAILII case number: [1991] UKEAT 1_90_1112

Appeal No. EAT/1/90

EMPOLYMENT APPEAL TRIBUNAL

4 ST. JAMES'S SQUARE, LONDON, SW1 4JU

At the Tribunal

On 11 December 1991

Before

THE HONOURABLE MR JUSTICE WOOD MC (P)

MR L D COWAN

MR D G DAVIES

MRS E McCOID APPELLANT

(1) COMMERCIAL & MARITIME LTD

(2) GED SERVICES LTD RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

APPEARANCES

For the Appellant Mr D Vulliamy

Hull Employment

Law Project

27 Salisbury Street

Hull

HU5 3HA

For the Respondents No attendance by First

or Second Appellants

MR JUSTICE WOOD (PRESIDENT): This case has a long history. It was on 21 April 1987 that Mrs McCoid issued an Originating Application in which she claimed unfair dismissal or in the alternative redundancy. a declaration of the terms and conditions of employment and written reasons for her dismissal were not provided or were inaccurate and she cited three Respondents - BP Chemicals Ltd, Commercial and Maritime Ltd and GED Services Ltd. They are all in the area of Hull.

BP Chemicals employs some 2,000 and has a substantial number of cleaners for its works. An Industrial Tribunal in August 1987 decided that it had no jurisdiction because the continuity of employment between the three Respondents was not established. There was an Appeal to this Court and we dealt with that matter in January 1989, remitted the case to be reconsidered because we felt that some particular points had not been raised. In fact we took the view that there were other matters which the Tribunal might like to consider and which had not been sufficiently crystallised.

There was a further hearing in front of an Industrial Tribunal in July 1989 but that was on a different issue which was whether Mrs McCoid had been employed by BP Chemicals. BP Chemicals took the view, and indeed at that time still took the view and argued that she was an independent contractor. It was a contract of services and not a contract of service and therefore she was not employed. An Industrial Tribunal found against BP Chemicals that she was employed, it was a Contract of Employment and thus the last stage in this story took place on 25 September 1989 when an Industrial Tribunal considered whether there had been a transfer between the Respondents of a business or undertaking.

The First Respondent, BP Chemicals was by then dismissed from the proceedings and

it was only the latter two, Commercial & Maritime Ltd and GED Services Ltd who were Respondents.

What happened is set out historically, very simply on pages 1 and 2 of the Reasons. BP had 25 so-called permanently employed cleaners. Of course they had maintained that they were not employed but the Tribunal had found that they were and Mrs McCoid was the longest serving of those. There was a decision whereby BP retained 25, but 5 cleaners were then to be employed by Commercial & Maritime Ltd. The reason why they were dismissed, and they were dismissed without notice we are told, was that there was a requirement from Head Office for a reduction in staff. Thus the 5 cleaners, including Mrs McCoid, were employed by Commercial & Maritime Ltd. The terms of their employment changed. With BP there had been no holiday or sick pay. With Commercial & Maritime there was a holiday and sick pay provision, but apart from that it seems that Mrs McCoid and the other of those 5 continued to come into work and to clean at BP Chemicals. They were involved with one particular set of offices and the medical centre. In fact Mrs McCoid worked in the medical centre.

There came a time in January 1987 when BP Chemicals gave Commercial & Maritime notice to terminate the cleaning contract. What is not quite clear is whether the whole of the cleaning had by then been taken on by Commercial & Maritime. It seems that it was simply these 5 persons. When that contract came to an end Mrs McCoid was away from work sick.

After January 1987 a company called GED Services Ltd then supplied cleaners to BP Chemicals and took on those cleaners but did not take on Mrs McCoid. They put on the books of the agency as people who were willing to carry out cleaning at BP. It is important to notice that the GED Services Ltd was not principally a cleaning company but had as one of its sidelines, this employment agency and also the Tribunal find as a fact that "the cleaners with the exclusion of Mrs McCoid, should go on the books of the agency so that they could be supplied as and when required to BP for cleaning services to be carried out with the "BP Ladies"."

The argument for Mrs McCoid was that there was an undertaking within the Transfer of Undertakings (Protection of Employment Regulations) 1981 which were to give effect to the provisions of the Directive 187/77 and that therefore she had a continuity of rights and she could claim therefore under the 1978 Act.

Three questions were posed by Mr Vulliamy. First, was there a severable commercial undertaking capable of being transferred? If "Yes", was there a transfer from BP to Commercial & Maritime? Thirdly, if so, was there a transfer from Commercial & Maritime to GED Services? Having found the facts the Tribunal took the view that this was not an undertaking within the meaning of the regulations and within the true understanding of the Directive. This was essentially a question of fact. They gave their views. In paras 7 - 9 of the Decision they say this:

"The tribunal is satisfied that, in relation to the facts surrounding the transfer of employees, if we may use a very loose term at this stage, from BP to Commercial & Maritime, that only those 5 employees were transferred.

They were not transferred by BP. They were, in effect, dismissed by BP and taken on by Commercial & Maritime.

"There was, in fact, no severable part of BP's business which could be regarded as an undertaking that was transferred. Had the whole of the cleaning business been transferred from BP to Commercial & Maritime then clearly there would have been a transfer of a part of an undertaking. This was simply an exercise to get rid of certain company employees and to get, in their place, contract labour and it was only because discussions took place between the trade union and the employees and the new company that those employees turned out to be the same employees who had been employed by BP doing that work. We cannot identify any part of BP's undertaking that was transferred even though these 5 worked in and among and were transferable and interchangeable with, as far as the work they were doing, the so-called permanent employees of BP."

It seems to us that on the facts and the evidence the Tribunal were perfectly entitled to reach their conclusion.

However, they also considered the matter further. Even if they were wrong about that and there was a transfer of an undertaking, they looked at the second situation, that between the two present Respondents Commercial & Maritime Ltd and GED Services Ltd and they deal with that in para 10 in this way, they say:

"..Arrangements were made before that happened, by BP, with another independent contract, to fill the gap caused by the ending of that contract but those negotiations where (sic) carried out by BP with another contractor and at no time was there any question of any transaction between Commercial & Maritime and GED Services Ltd. So, again, there could be no transfer of a business from Commercial & Maritime to GED Services nor could there be any question of BP taking the cleaners "in house" and then contracting them out again, so that again, clearly, there was no transfer of undertaking at that stage."

and they end by saying:

"At the end of the day this case has been determined on its facts, which have been complex enough, without the necessity of having regard to a series of cases cited to us on the effects of the transfers of undertakings because, in principle, the tribunal has found that there was no transfer of an undertaking only the transfer, in effect, of some employees as a fact rather than an intention of what was done. That is to say they were transferred as a matter of negotiation not between BP and Commercial & Maritime so much as between individuals, the trade union and Commercial & Maritime."

Mr Vulliamy has argued his case most attractively and he has sought to say that one does not need necessarily to have goodwill, assets and so on, the normal business attributes, in order for there to be an undertaking. That may be true, but here the facts were examined by the Tribunal and they decided that this was not an identifiable undertaking or business which was being transferred. It was not even a transfer. There was a re-arrangement by which certain employees were re-employed by others. They were being re-employed by a different concern.

He also submitted that the transaction should be looked at in the round and referred us to a number of authorities. We are inclined to agree with the Tribunal that it was really a question of fact and it is to be remembered that the Tribunal also found that so far as the last company was concerned the cleaners would only be supplied to BP as and when required for cleaning services. So it was rather a different picture from that which had pertained at BP in the first place.

Thus it seems to us clear, BP had regular cleaners, 5 they said were not employed, they were found to be employed but they were a little "rump end" of the cleaning staff. It was not an entity as such and the Tribunal have found that in the circumstances therefore this was essentially an issue of fact. There is no misdirection on principles of law and although we sympathise with the view expressed by one member as to the position in which Mrs McCoid found herself, that is not something which is relevant to our considerations today.

It follows therefore that this Appeal must be dismissed.