The Employment Appeal Tribunal (EAT) has held that staff at a care home should have been consulted on changes to pay arrangements following a TUPE transfer but it has decided that the original award should be reduced.
In Todd v Strain and others, the EAT agreed that the previous owner of the company had failed to consult staff on relevant measures involved in the transfer, including a change to their pay date.
Employees found out about the transfer to a new employer in a meeting attended by less than one-third of the total workforce. At the meeting staff were told their jobs were safe but were not given any other information. However, as a result of the transfer some of the pay arrangements were changed.
The original ruling by an employment tribunal ordered the previous owner to pay staff the maximum award of 13 weeks’ pay as they had caused “needless worry” by failing to consult staff fully. However, the EAT disagreed with the amount of the award and reduced it to seven weeks’ pay.
Emma Richardson, associate at law firm Dechert, commented: “The EAT basically says that part of the duty in a TUPE transfer is to make sure employees are reassured, which I think is an interesting take on the obligation to inform and consult.
“Although employers potentially now need to consult about a wider range of issues, it does mean that the employees will be fully engaged and reassured about what’s going on. When you’re taking over a business it is helpful if people aren’t worried at the outset about what is going to happen to their jobs.”
The EAT acknowledged that, although administrative changes are usually necessary during transfers and the disadvantage to employees was not obvious, staff should have been consulted as the measures could have been avoided.
However, the EAT reduced compensation awarded to staff as they had been given some basic information about the transfer and a reassurance that their jobs were safe.