United Kingdom Employment Appeal Tribunal

BAILII case number: [1994] UKEAT 56_93_2207

Appeal No. EAT/56/93

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 22 July 1994

Before

THE HONOURABLE MR JUSTICE MORISON

MR E HAMMOND OBE

MR J A SCOULLER

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PRIDE VEHICLE CONTRACTS LTD          APPELLANTS

MRS T CLARK          RESPONDENT

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellants MS SARAH LEE

(OF COUNSEL)

Messrs Bower Cotton

& Bower

36 Whitefrairs Street

London EC4Y 8BH

For the Respondent MR P CLARK

(LAY REPRESENTATIVE)


 


MR JUSTICE MORISON: As this is an ex tempore judgment, that means partly off the top of our head, I say as I always do when giving such a judgment that I reserve to, myself, the right to add to, alter, vary, or otherwise generally try and seek to improve the language with which I now seek to express this our decision in the matter of Pride Vehicle Contracts Ltd, or PVC, or the employer, as we shall refer to them throughout this judgment.

This is an appeal against the unanimous decision of an Industrial Tribunal held at London North which was entered in the Register on the 29 November 1992. The sole issue before the Industrial Tribunal was whether the Applicant, Mrs Clark, had sufficient continuous employment, two years, with Pride Vehicle Contracts Ltd to entitle her to bring a claim against them for unfair dismissal arising out of the termination of her employment on the 5 March 1992. It is regrettable that this preliminary issue has taken so long to reach this Appeal Tribunal. If the appeal is dismissed, as we propose it should be, an Industrial Tribunal will have to examine the fairness of the decision to dismiss, which was made more than two years before.

The facts relating to the issue are as follows. Mrs Clark commenced employment with County Contract Hire Ltd, whom we shall call hereafter CCH, in February 1989. That Company was a subsidiary of Berisford Plc. In 1990, following the Managing Director's conviction for fraud, CCH entered into an agreement with Pride Management Services Plc, called PMS. Under that agreement PMS were engaged as CCH's agent to administer on its behalf CCH's business which involved the hiring out of equipment. In addition, PMS were given a first option to buy CCH's business.

The Industrial Tribunal found that having heard oral evidence from a Mr Vincent, the employers Solicitors, that "any new business" that came in, including renewal of contracts with existing customers was put into the name of a PMS subsidiary, County Contract Hire UK Ltd, who we shall call CCH UK.

On the 28 June 1991 Mrs Clark was told that she was going to be dismissed and that all monies due were to be paid to her and that she was to be re-employed by the employers as from the 1 July 1991: the employers are also a subsidiary of PMS. She continued, according to the findings of fact made by the Industrial Tribunal, to do exactly the same work under the same management as she had previously done with CCH. The decision continues:

"Mr Vincent informed us that in October 1991 serious discussions started regarding the sale of CCH to PMS and the transaction was concluded in February 1992."

It is to be observed at this stage that neither the arrangement of which Mr Vincent gave oral evidence relating to putting new contracts into CCH UK, nor the arrangements relating to the sale of shares ultimately in CCH was evidenced by documents. Thus, Mr Vincent gave oral evidence as to matters which must have been contained in written documentation which was not produced to the Tribunal. We want to make it absolutely clear for the future that where an employer is seeking to say that there has been no continuity of employment and is seeking to allege that there has not been a transfer of employment within the schedule, it is encumbered on the employer to be full and frank with the Tribunal and to produce all relevant documentation.

It seems to us on analysis that the position may be described in this way. CCH's business up until the time of the agency contract, involved the making and renewing of hire contracts and related matters, and the servicing of that business. For that purpose Mrs Clark had been employed. After the management agreement had been made, and after the arrangement about which Mr Vincent gave evidence, and which is referred to in paragraph 6 of the Industrial Tribunal decision, Mrs Clark's job did not change, she continued to provide the same services, that is, negotiating and undertaking new business which she was doing presumably on behalf of CCH UK, although she remained employed by CCH and she was servicing CCH's existing business which presumably she was doing on behalf of PMS who were the agents who were responsible for that purpose.

When the arrangement, which Mr Vincent spoke about, took place all that happened was that some of the contracts which otherwise would have been with CCH were placed with CCH UK, but that made no difference to the services which Mrs Clark was employed to provide. Subsequently what happened appears to be this: PMS assigned to PVC its obligations and rights under the agency arrangement so that PVC were employing staff who were engaged on the same work which Mrs Clark was engaged on although they were employed by two separate entities.

Following these arrangements, in July 1991 Mrs Clark's employment was transferred to PVC because the companies decided that the provision of services in relation to CCH and CCH UK Contracts should be amalgamated the one with the other. In those circumstances it seems to us that it is unquestionably the case that at the time when it was agreed that new contracts would be put into the CCH UK Company there was a transfer of a business within the meaning of the regulations and she continued to be employed pursuant to those arrangements with CCH, but thereafter her employment also transferred across as part of the transfer of the business.

As part and parcel of the overall transaction her employment was amalgamated with those who had been servicing the same contracts, who were employed by PVC, and accordingly, the business of providing the services was rationalised at that time. Accordingly, it seems to us perfectly clear that there has been a transfer which attracts the operation of the regulations and that her move over to PVC was simply a step in that transfer arrangement. The fact that ultimately the stub end of CCH's business was transferred to PVC, or PMS Group, as a result of a transfer of shares, does not in our judgment effect the position.

The economic entity concerned was the provision of services in relation to the negotiations of new contracts and the extension and servicing of existing contracts. That business was, as we see it, transferred, by a two stage process, to PVC and in those circumstances it seems to us manifestly plain that there has been continuity of employment, such that Mrs Clark can justifiably complain of unfair dismissal against PVC, who became her employers as a result of a process of transfer to which the regulations apply.

Accordingly, it seems to us that there is no point that is arguable on this appeal, despite if I might say so, the best efforts of Miss Lee, who has recognised what I think is inevitably the case, that in so far as the incoming tide of European law has been affecting our domestic law that tide has been incoming with greater force since the date when the Tribunal gave its original decision. But even on the basis of the law as it then stood it was a decision with which we would unhesitatingly have agreed and accordingly we think that there is no merit in this appeal.

We direct, therefore, that this case should be heard and determined by an Industrial Tribunal so soon as is reasonably practicable and that priority should, if possible, be accorded to this case, bearing in mind the fact that the dismissal took place such a long time ago.

Mrs Clark, you have the right to make an application to us for costs in limited circumstances, namely, where you can say that the appeal has been unreasonable or unnecessarily maintained and if you made such an application we would be obliged to consider it. I am neither encouraging you to make such an application or discouraging you from making it, it is up to you, but I do not think that we can sit here and not say anything about it if you are ignorant of your rights.