Veitch Penny LLP - Exeter | Crediton, Devon

Case

Sweetin v Coral Racing
Employment Appeal Tribunal - (20th December 2005)

Issues

(1)Transfer of Undertakings (Protection of Employment) Regulations 1981 ("TUPE")
(2)Failure to consult
(3) Assessment of compensation

Facts

Ms Sweetin was employed as a clerk in a business which was subject to a transfer of undertakings in September 2003. Prior to the transfer she had undertaken some of the duties of a deputy manager. She was told that she would be transferred to the new employer on the same terms and conditions of employment. She took this to mean that she would not be made deputy manager as she had hoped. She resigned and claimed constructive unfair dismissal and failure to consult with her prior to the transfer.

The tribunal found that she had not properly submitted her grievance until two weeks before she resigned. It therefore held that there had been no failure by the employer to provide her with a prompt opportunity to obtain redress for her grievance, as per the case of W.A. Goold (Pearmak) Ltd v McConnell [1995]. This meant there was no breach of the duty of trust and confidence, and consequently, the tribunal could not find she had been constructively unfairly dismissed.

However, the tribunal did make a finding that there had been a serious failure by the employer to properly consult with the employer prior to the transfer. In assessing Ms Sweetin's award, the tribunal considered the seriousness of the breach and the losses Ms Sweetin had actually suffered. On this basis she was awarded six weeks' pay rather than the maximum possible award of thirteen weeks.

Decision

On appeal to the Employment Appeal Tribunal (EAT), Ms Sweetin was partially successful. It concluded that whilst the tribunal had been correct in its finding in respect of the constructive unfair dismissal claim, the tribunal had been incorrect in its assessment of compensation for failure to consult. It compared the power to award compensation in cases such as this to the power the tribunal has for failure to consult in collective redundancies, under the Trade Union and Labour Relations (Consolidation) Act 1992. The EAT applied the same principles to this case, and imported the principles set out in the case of Radin (Susie) Ltd v GMB & Ors [2004]. This case stated that a tribunal should consider the seriousness of the default and take account any mitigating factors to justify reducing the award from the maximum. On this basis, the EAT substituted the maximum award of 13 weeks pay. The award was designed to be a penal one.

Comments

This case is notable for two reasons:

a)The EAT's consideration of the Goold case. In that case, it was found that the employer's duty to afford employees a prompt and reasonable opportunity to obtain redress for their grievances was fundamental. By contrast here, the EAT was not of the view that a failure to provide such an opportunity would automatically give rise to a finding of a breach of the duty of trust and confidence. This, in the EAT's view, will depend on the facts of the case.

b)The EAT has now confirmed that the principles in the Radin case are directly applicable to the tribunal's power to make awards for failure to consult under the TUPE Regulations.