Variation of employment terms which arose on a transfer of an undertaking were ineffective. Mummery P J said: ‘It is also an error on the part of the tribunal to conclude that the affirmation of the contract by the subsequent conduct of the parties avoids the mandatory effect of reg. 5(1), interpreted in accordance with the Daddy’s Dance Hall [1988] IRLR 315 decision. The variations in the contract terms, said to have been affirmed by the subsequent conduct of the applicants, relate back to the time of the transfer when the variations were made and accepted by reason of the transfer and were therefore prohibited. What happened subsequently was confirmation by conduct of what had already happened on, and by reason, of the transfer. It is true that there may be cases where an effective variation of the terms of employment does take place subsequently either by express agreement or by agreement inferred from conduct. Whether there is such a variation depends on the facts of each case. The reason for the variation depends on the facts of the case. The law, surprising though it may be to English legal tradition, is clear. If the operative reason for the variation is the transfer of the undertaking, then the variation will be ineffective. In this case there was no evidence before the tribunal that the reason for the variation, which took place at the time of the transfer, was anything other than the transfer itself. The ‘economic, technical or organisational reason entailing changes in the workforce’ did not alter the fact that the variations took place by reason of the transfer at the time of the transfer. There was no subsequent separate agreement varying the terms of employment after the transfer. The subsequent conduct relied on as affirmation was conduct consistent with variations made at the time of and by reason of the transfer. If, as Daddy’s Dance Hall [1988] IRLR 315 holds, there can be no agreement to vary terms and conditions by reason of the transfer, there cannot be any subsequent effective affirmation of that variation. It remains prohibited by the regulations.’
Judges:
Mummery P J
Citations:
Times 10-Apr-1996, [1996] UKEAT 641 – 95 – 1602, [1996] IRLR 320
Links:
Statutes:
Transfer of Undertakings (Protection of Employment) Regulations 1981 No 1794 5
Jurisdiction:
England and Wales
Citing:
Cited – Foreningen Af Arbejdsledere I Danmark v Daddy’s Dance Hall A/S ECJ 10-Feb-1988
The claimant, Mr Tellerup, was employed as a restaurant manager by the transferor, Irma Catering A/S. When its lease was terminated it dismissed all staff. Mr Tellerup’s statutory period of notice expired on 30 April 1983. But it continued to run . .
Cited by:
Cited – Smith and Others v Trustees of Brooklands College EAT 5-Sep-2011
EAT TRANSFER OF UNDERTAKINGS – Varying terms of employment
The Employment Judge was entitled to hold that the agreed variation of the Claimants’ salary was not for a reason connected with a relevant TUPE . .
Lists of cited by and citing cases may be incomplete.
Employment
Updated: 20 May 2022; Ref: scu.90546