United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR P DRAYCOTT (Representative) Fulham Legal Advice Centre 679a Fulham Road London SW6 5PZ
For the Respondents	THE RESPONDENTS NEITHER PRESENT NOR REPRESENTED


 


JUDGE PETER CLARK:

1. The first appellant, Mr Crecente, commenced work in the respondent's Pissaro Wine Bar in September 1987. The second appellant, Mr Candido Silva, commenced employment in late 1993.
2. The respondents are Mr and Mrs Carvosso, formerly owners of the Wine Bar.
3. It appears that on about 15th March 1999 the appellants were handed a letter from the respondents dated 18th March which stated that the Wine Bar would be closing on Saturday, 27th March 1999. On about 20th March they were each given a further letter stating that the Wine Bar would close on Saturday, 27th March and that there would be a staff party at lunchtime the following day.
4. In these circumstances, it appears that both appellants were dismissed by the respondents on 27th March 1999.
5. Further, that the premises and equipment therein were purchased by a subsidiary of Bass PLC and that the intention of Bass' subsidiary was to turn the premises into a bar/restaurant under their Brown's banner.
6. On 24th May 1999 the appellants commenced these proceedings against the existing respondents. They claimed unpaid notice monies and unpaid holiday entitlement. At that stage neither was represented.
7. They took advice from the Fulham Legal Advice Centre. As a result the Advice Centre wrote to the Employment Tribunal on 8th July in these terms:

"We have also been informed by our clients that their dismissal appeared to be connected to a transfer of undertakings from the respondent to a third party. We are currently making investigations regarding this issue, and when finalised hope to make an application to add a further respondent to the proceedings in the near future."

Subsequently, on 13th July the Advice Centre wrote a further letter to the Employment Tribunal seeking leave to add Bass PLC as a further respondent on the basis that there was, at any rate arguably, a relevant transfer of the business in which the appellants were employed from the respondents to Bass.

8. A hearing took place before the London (South) Employment Tribunal, Chairman Miss C Taylor, on 16th July 1999. It was a full panel, which heard the case on that day.
9. The purpose of the hearing was to consider the appellants' application, first, to add a complaint of unfair dismissal to the existing grounds of claim against the existing respondents, Mr and Mrs Carvosso; and secondly, their application to join Bass PLC as a respondent to the proceedings and to add a complaint against Bass of unfair dismissal.
10. At that hearing the appellants were represented by Mr Draycot, who appears before us today, and Mr Carvosso in person represented himself and his wife.
11. The tribunal's order with reasons, promulgated on 3rd August 1999, is in summary form. There is a tension between the Employment Appeal Tribunal Rules and those of the Employment Tribunal. Under the EAT Rules, Rule 3(1)(c) an appellant is required to lodge with his Notice of Appeal a copy of the tribunal's extended reasons for the decision or order against which the appeal is brought. However, under the Employment Tribunal Rules of Procedure, Rule 10, there is no requirement on an Employment Tribunal to provide extended reasons for an interlocutory order which is not a decision within the meaning of Regulation 2(2) of the 1993 Regulations. It seems to us that the orders made on 16th July do not constitute a decision within the meaning of Regulation 2(2). That may explain the paucity of reasons in the document, although we are content to entertain this appeal under Rule 39(2) of the EAT Rules in the absence of extended reasons.
12. The tribunal granted leave to the appellant to add a complaint of unfair dismissal against the existing respondents, Mr and Mrs Carvosso, but they refused the application by the appellants to join Bass PLC as a second respondent.
13. The tribunal's reasons are put shortly in paragraph 3 in this way:

"3. We then turned to consider the second application. [Joinder of Bass PLC] It appears to us, having heard the submissions, that there is no merit to this application. It is the view of the Tribunal that this is a weak claim which should not, in the circumstances, be permitted to proceed to hearing. Therefore the application is refused."

14. Mr Draycot has told us, and we accept, that he advanced argument before the Employment Tribunal designed to show that on such facts as were then known, namely, that all of the assets of the Wine Bar and the premises themselves were transferred to Bass PLC or its subsidiary and that Bass intended to turn the premises into a bar/restaurant following refurbishment, pointed to a relevant transfer having taken place within the meaning of Regulation 5 of the Transfer of Undertakings (Protection of Employment) Regulations 1981 and the Acquired Rights Directive 77/187.
15. Conversely it seems that Mr Carvosso did not advance any argument that a relevant transfer had taken place. On the contrary, he contended that what had happened was merely a sale of assets and not the transfer of a business. If there were any doubt about that we have considered the letter which he wrote to the Appeal Tribunal dated 17th September 1999 explaining that he would be unable to attend the hearing before this tribunal today, in which he says this:

"I resist the appeal on the same grounds as relied upon by the Employment Tribunal namely that I sold the real property to Bass Leisure and not the business."

16. Against the tribunal's refusal to grant leave to add Bass PLC as a second respondent, this appeal has been brought.
17. In a detailed and careful skeleton argument Mr Draycot has developed his theme, based on high authority, that on the face of it a relevant transfer did take place between the Carvossos and Bass PLC of the business in which the appellants were employed.
18. However, it seems to us that that argument misses the central point which is this. First, the application to join Bass is made out of time, that is outside the primary three-month limitation period. It is true that the application to add a claim of unfair dismissal against the existing respondents was granted by the Employment Tribunal but there there was a respondent who had been brought into the proceedings in time. The fact that the application to join Bass is made out of time is a factor, although not a conclusive factor, which the tribunal was entitled to take into account. See Selkent Bus Co Ltd –v- Moore [1996] IRLR 661.
19. However, the more substantial point we think is this. The reason for wishing to add Bass as a respondent and indeed the main purpose of the appeal before us today, is to protect the position of the appellants. They fear that at the end of the day a finding may be made that a relevant transfer had taken place to Bass which would have the effect of relieving the Carvossos of responsibility for any finding of unfair dismissal or unpaid notice or holiday monies. We can put the appellants' minds at rest as to that.
20. The question of whether or not a relevant transfer took place is simply not an issue in the case as things presently stands. In the absence of any plea by Mr Carvosso that a relevant transfer has taken place, it seems to us that any liability which is found to exist for unfair dismissal, unpaid notice or unpaid holiday entitlement, must rest with him. We bear in mind the effect of the House of Lords decision in Wilson v St Helen's Borough Council [1998] ICR 1141, that if a relevant transfer takes place any dismissal prior to the transfer will not be a nullity but is an effective dismissal. So that what passes over at the time of transfer is not the employment as such, but any rights and liabilities of the transferor for unfair dismissal or other claims arising prior to the transfer. Since it is accepted by the Carvossos that no such transfer took place, it follows that they will be liable for any unfair dismissal compensation, unpaid notice or unpaid holiday pay, which the tribunal may find to be due to the appellants.
21. In these circumstances, it seems to us that as a matter of discretion the tribunal's decision not to join Bass PLC as a second respondent and thereby retrospectively provide for a claim in time against them, was one which they were entitled to reach.
22. We should add this. There is no suggestion before us that the present respondents, who are personal respondents, there is no limited company here sued, are unable to meet the claims which are brought against them. We are told that they own Hobart Hall Hotel, 43-47 Petersham Road, Richmond-upon-Thames. In these circumstances, we can well see that there is no concern as to their personal solvency.
23. In these circumstances, the appeal is dismissed.