Employment Flash -13th August 2010

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Duty to inform and duty to consult under TUPE 13(2) and 13(6) are separate duties; approach to compensation under reg 15(8).

Todd v Strain & others [2010] UKEAT 0057 10 B1

TUPE transfer of care home from T to CC. ET found breaches of duty to consult and duty to inform under TUPE 13(2)(6) and awarded 13 weeks pay under reg 15(8). T appealed.

T had held a meeting with 18-20 members of staff 7 weeks or so before the transfer though no prior notice was given of the subject matter of the meeting. T identified CC as transferee and indicated that staff jobs were safe but no detailed information was given and nothing communicated in writing. There was no provision of information or consultation with appropriate representatives but T maintained there was no requirement for the same as: a) T did not envisage taking 'measures' affecting any employee in connection with the transfer; b) the obligation to inform under 13(2) only arose if there was an obligation to consult under 13(6).

The EAT applied the reasoning from Institution of Professional Civils Servants v Secretary of State for Defence [1987] IRLR 373 (IPCS) which concerned the Dockyard Services Act 1986. The IPCS reasoning is to the effect that 13(2) deals with voluntary consultations and 13(6) are consultations which the employer is obliged to hold and 13(2) does not depend on 13(6) being engaged. IPCS was recently applied in Cable Realisations Ltd v GMB Northern [2010] IRLR 42. As 13(11) requires the employer to provide information to the employees where no representatives are elected and on T's case the effect of not envisaging taking measures (so that 13(6) is not engaged) would be that the employer does not even have to provide the basic information of there being a transfer, then the duty to inform is not solely for the purpose of enabling consultation to take place.

As to the 13(6) argument that T did not envisage taking 'measures', IPCS determined that 'measures' was a word with a wide implication which would include any action, step or arrangement. It must, though, be something deliberately done by the transferor in addition to what necessarily occurs as a consequence of the transfer itself. The ET had identified 3 measures that had been envisaged: wages details; tax rebate; extra hours payment. The measures, though not in substance major, could not be said to be de minimis and there was no requirement under the regulations that they should be disadvantageous in order for 13(6) to be engaged.

The EAT reiterated that the approach in Susie Radin Ltd v GMB [2004] ICR 893 applied to compensation under reg 15(8): a) it is a sanction against an erring employer rather than compensation of loss for an employee; b) there is a wide discretion to do what is just and equitable but the focus should be on the seriousness of the employer's default; c) fault may be technical right through to complete failure to inform and consult; d) deliberateness of the failure may be relevant, as may the availability of legal advice; e) assessment of the length of the protected period is a matter for the ET, a proper approach in a no consultation case is to start with the maximum period and reduce it only if there are no mitigating circumstances.

The ET had not focused on the seriousness of the employer's default. Here some information had been given to the workforce; there was an intention that that information would come to the attention of those not present at the meeting; the 'measures' were not of great significance; CC were not expected to introduce any substantial changes to working conditions. 13 weeks pay was too much. 3 weeks as contended for by T was too little as this was not a case where the employer had done everything a reasonable employer could do but was in breach of reg. 13 because she had not worked through employee representatives. An announcement at a meeting was not sufficient; leaving the remainder of the workforce to find out subsequently was not sufficient; she could have written to the entire workforce; she could have had meetings with each shift; the workers were underinformed; there was a failure to give prompt and full answers to questions raised by the manager; some matters though not being matters about which formal consultation was required could have been the subject of informal consultation following the supply of information. The failures had caused real distress to the workers. Award varied to 7 weeks' pay.