Mr B Bond v Ship Shape Resources Ltd and Nasa Umbrella Ltd: 6005480/2024
JUDGMENT
Having heard representations from the parties, the Claim of Unfair Dismissal is dismissed because the Claimant does not have two years’ service and none of the exceptions apply. THIS JUDGMENT HAS BEEN APPROVED BY EMPLOYMENT JUDGE SELF 12 June 2025 Sent to the parties on: 17 June 2025 For the Tribunal Office Case No: 6005480/2024 1 EMPLOYMENT TRIBUNALS Claimant: Mr B Bond Respondents: Ship Shape Resources Limited(1) Nasa Umbrella Limited(2) Heard at: Exeter Employment Tribunal (by video) On: 15 October 2025 Before: Employment Judge Volkmer Representation Claimant: In person Respondent: Ms Elsey (Payroll Director) JUDGMENT[1]The Claimant’s constructive wrongful dismissal complaint is not well founded and is dismissed.[2]The Claimant’s complaint of a failure to inform and consult under regulations 13 and 14 of the Transfer of Undertakings (Protection of Employment) Regulations 2006 is well-founded and is upheld.[3]The Respondents must pay the Claimant a sum equivalent to 12.5 weeks’ pay, £34,375 (gross) in relation to the failure to inform and consult.[4]This sum must be paid within 14 days of this judgment being sent to the parties.[5]The First and Second Respondent’s liability is joint and several[6]The Claimant is responsible for accounting for any tax in relation to the sum. Approved byREASONS
[1]The Claimant presented a claim to the Tribunal on 10 July 2024 making complaints of constructive unfair dismissal, wrongful dismissal and a failure to inform and consult under Regulations 13 and 14 of the Transfer of Undertakings (Protection of Employment) Regulations 2006. This followed notification to ACAS on 28 May 2024. The ACAS certificate was issued on 9 July 2024.[2]There was a preliminary hearing on 12 June 2025 before Employment Judge Self. The Case Management Orders determined at that hearing, including the List of Issues was sent to the parties on 17 June 2025 (the “CMO”). The Claimant’s constructive unfair dismissal complaint was dismissed because the Claimant did not have two years’ service. The dismissal judgment was also sent Case No: 6005480/2024 2 to the parties on 17 June 2025. The constructive dismissal remains in the List of Issues because it is relevant to the wrongful dismissal complaint.[3]The Tribunal heard oral evidence from the Claimant and Ms Elsey on behalf of the Second Respondent. An agreed hearing bundle was provided in the form of an electronic folder with 10 items in it, as well as an index document. Documents are referred to in this judgment by reference to their electronic document number in that folder.[4]During the hearing, at the request of the Tribunal, the Claimant sent to the Tribunal the payslips relating to the last few months of his employment with the First Respondent. These were copied to the Second Respondent, who did not object to their submission.The Issues
[5]The List of Issues as set out in the CMO are as follows. 1. Constructive dismissal claim1.1 The Claimant claims that the First and/or Second Respondent or both acted in fundamental breach of contract in respect of the express and / or / implied term of the contract relating to holiday pay (express) / mutual trust and confidence (implied). The breach(es) was / were as follows;1.1.1 the manner in which the Respondents dealt with the TUPE transfer.1.1.2 the change to the Claimant’s contractual entitlement to holiday pay. (The last of those breaches was said to have been the ‘last straw’ in a series of breaches, as the concept is recognised in law).1.2 The Tribunal will need to decide the following.1.2.1 Whether there was breach of an express term of the Claimant’s contract.1.2.2 Whether the Respondent behaved in a way that was calculated or likely to destroy or seriously damage the trust and confidence between the Claimant and the Respondent.1.2.3 Whether it had reasonable and proper cause for doing so.1.3 Did the Claimant resign because of the breach? The Tribunal will need to decide whether the breach was so serious that the claimant was entitled to treat the contract as being at an end.1.4 Did the Claimant delay before resigning and affirm the contract? The Tribunal will need to decide whether the breach of contract was a reason for the Claimant’s resignation. Case No: 6005480/2024 3 2. Wrongful Dismissal2.1 If the Claimant was constructively dismissed.2.2 What notice period was the Claimant entitled to?2.3 Was the Claimant paid for that notice period? 3. Failure to comply with obligations pursuant to Reg 13 and Reg 14 of TUPE3.1 Was the Claimant an “affected employee”?3.2 Was the Claimant (or a representative) adequately consulted and informed?The Facts
[6]The Claimant was employed by the First Respondent from 20 April 2023. His day-to-day work was for a different entity, the “end client”, although both parties agreed that the First Respondent was his employer. The First and Second Respondents provide “employer payroll” services, taking on the role of employer of employees who provide services to end clients.[7]Although the Claimant’s contractual terms referred to variable hours, he worked the same hours each week and worked full time, every week in the year. His contract provided that he could elect between receiving holiday pay on an “accrued” basis (i.e. he would be paid as normal during his holiday) or on a “rolled up” basis (i.e. an element relating to holiday pay would be added to his weekly/monthly payslips and he would not then be paid for holiday).[8]A sale of the First Respondent’s business from the First Respondent to the Second Respondent was agreed in early May 2024. I find, based on Ms Elsey’s evidence, that this involved the Second Respondent acquiring around 200 employees from the First Respondent. The Claimant was one of the employees who it was intended would transfer from the First Respondent to the Second Respondent.[9]I find, based on Ms Elsey’s evidence, that there were no employee representatives in place at all in relation to those 200 employees. No elections of employee representatives were initiated or held for the purposes of the TUPE information and consultation process. This is based on Ms Elsey’s evidence.[10]On 10 May 2024, the First Respondent sent out a letter by email to individual employees notifying them that their employment was going transfer to the Second Respondent under TUPE and giving them relevant information (a template for the relevant letter is provided at Evidence #8). The letter notified employees that the transfer of their employment would take place on 17 May 2024.[11]The Claimant did not receive the letter of 10 May 2024. I find the Claimant’s evidence credible on this. Ms Elsey gave evidence that is was her understanding that a letter in the form of the template was sent to all employees, but she does not have personal knowledge of whether the letter Case No: 6005480/2024 4 was sent to the Claimant. This is because Ms Elsey works for the Second Respondent, and the relevant letters were sent by the First Respondent. The Second Respondent did not gain access to the First Respondent’s server so was not able to access the email inboxes of the First Respondent. I prefer the Claimant’s evidence, as he has first hand knowledge of the evidence he gives on this point and it is also consistent with his contemporaneous resignation letter (Evidence #3).[12]The first the Claimant was aware of the transfer was on 15 May 2024 at 11.44 when he received a phone call from Beth Cole of the First Respondent telling him that his payment on 16 May 2024 would be his final payment from the First Respondent and that it would include a payment in respect of accrued holiday. The Claimant became aware that the Second Respondent would not offer accrued holiday, but only rolled up holiday. This was something he objected to.[13]Later on 15 May 2024 he found an email in his junk folder about the transfer (Evidence #4), which referred to the letter of 10 May 2024 and invited questions. The Claimant responded to the email address given, but his email was bounced back.[14]On 15 May 2024, the Claimant approached his recruitment agent who advised him that he could move to a different employer payroll company, whilst still undertaking the same work for the same end client. He decided to do so and agreed the approach with his recruitment agent.[15]On 17 May 2024, the Claimant sent a letter saying he was resigning from the First Respondent (Evidence #3) because of the change to holiday pay arrangements and his view that there had been a failure to adequately inform and consult.[16]The Claimant began using a different employer payroll company on the following Monday (20 May 2024). He continued to work on the same contractual terms for the same end client with no break in work or pay. The Law Constructive dismissalThe Law
[17]Under section 95(1)(c) of ERA 1996, an employee is dismissed if they terminate the contract under which they are employed (with or without notice) in circumstances in which they are entitled to terminate it without notice by reason of the employer’s conduct. This is often referred to as a “constructive dismissal”. Wrongful dismissal[18]An action for wrongful dismissal is a common law breach of contract claim. The Tribunal must determine whether the dismissal is in breach of contract. In a conduct case this will involve a finding of whether there was, in fact, misconduct which is so serious that it entitled the employer to dismiss the employee. If there was no such misconduct, the dismissal is a wrongful dismissal. Whether the employer’s actions are reasonable or not is irrelevant (Enable Care and Home Support Ltd v Pearson EAT 0366/09). Case No: 6005480/2024 5 TUPE[19]The Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”) apply to certain transfers of businesses. Regulation 3 of TUPE sets out the definition a “relevant transfer” as follows. “3. — A relevant transfer (1) These Regulations apply to— (a) a transfer of an undertaking, business or part of an undertaking or business situated immediately before the transfer in the United Kingdom to another person where there is a transfer of an economic entity which retains its identity; (b) a service provision change, that is a situation in which— (i) activities cease to be carried out by a person (“a client”) on his own behalf and are carried out instead by another person on the client's behalf (“a contractor”); (ii) activities cease to be carried out by a contractor on a client's behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are carried out instead by another person (“a subsequent contractor”) on the client's behalf; or (iii) activities cease to be carried out by a contractor or a subsequent contractor on a client's behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are carried out instead by the client on his own behalf, and in which the conditions set out in paragraph (3) are satisfied.”[20]Regulation 13 of TUPE sets out the following. “13.— Duty to inform and consult representatives(1) In this regulation and regulations 13A 14 and 15 references to affected employees, in relation to a relevant transfer, are to any employees of the transferor or the transferee (whether or not assigned to the organised grouping of resources or employees that is the subject of a relevant transfer) who may be affected by the transfer or may be affected by measures taken in connection with it; and references to the employer shall be construed accordingly.(2) Long enough before a relevant transfer to enable the employer of any affected employees to consult the appropriate representatives of any affected employees, the employer shall inform those representatives of— (a) the fact that the transfer is to take place, the date or proposed date of the transfer and the reasons for it; (b) the legal, economic and social implications of the transfer for any affected employees; (c) the measures which he envisages he will, in connection with the transfer, take in relation to any affected employees or, if he envisages that no measures Case No: 6005480/2024 6 will be so taken, that fact; and (d) if the employer is the transferor, the measures, in connection with the transfer, which he envisages the transferee will take in relation to any affected employees who will become employees of the transferee after the transfer by virtue of regulation 4 or, if he envisages that no measures will be so taken, that fact. (2A) Where information is to be supplied under paragraph (2) by an employer— (a) this must include suitable information relating to the use of agency workers (if any) by that employer; and (b) “suitable information relating to the use of agency workers” means— (i) the number of agency workers working temporarily for and under the supervision and direction of the employer; (ii) the parts of the employer's undertaking in which those agency workers are working; and (iii) the type of work those agency workers are carrying out.(3) For the purposes of this regulation the appropriate representatives of any affected employees are— (a) if the employees are of a description in respect of which an independent trade union is recognised by their employer, representatives of the trade union; or (b) in any other case, whichever of the following employee representatives the employer chooses— (i) employee representatives appointed or elected by the affected employees otherwise than for the purposes of this regulation, who (having regard to the purposes for, and the method by which they were appointed or elected) have authority from those employees to receive information and to be consulted about the transfer on their behalf; (ii) employee representatives elected by any affected employees, for the purposes of this regulation, in an election satisfying the requirements of regulation 14(1).(4) The transferee shall give the transferor such information at such a time as will enable the transferor to perform the duty imposed on him by virtue of paragraph (2)(d).(5) The information which is to be given to the appropriate representatives shall be given to each of them by being delivered to them, or sent by post to an address notified by them to the employer, or (in the case of representatives of a trade union) sent by post to the trade union at the address of its head or main office.(6) An employer of an affected employee who envisages that he will take Case No: 6005480/2024 7 measures in relation to an affected employee, in connection with the relevant transfer, shall consult the appropriate representatives of that employee with a view to seeking their agreement to the intended measures.(7) In the course of those consultations the employer shall— (a) consider any representations made by the appropriate representatives; and (b) reply to those representations and, if he rejects any of those representations, state his reasons.”[21]Regulation 14 of TUPE sets out the requirements in relation to the election of employee representatives.[22]Employers can consult directly with employees in certain limited circumstances which are set out in regulation 13A as follows. “13A.— Variation to the duty to inform and consult where no appropriate representatives(1) This regulation applies if, at the time when the employer is required to give information under regulation 13(2) - (a) at least one of the following conditions is satisfied - (i) the employer employs fewer than 50 employees; (ii) there are fewer than 10 transferring employees; (b) there are no appropriate representatives within the meaning of regulation 13(3); and (c) the employer has not invited any of the affected employees to elect employee representatives. (1A) For the purposes of paragraph (1)(a)(ii), "transferring employees" means the employees who work for the transferor and who are to be (or are likely to be) transferred to the transferee's employment under a relevant transfer.(2) The employer may comply with regulation 13 by performing any duty which relates to appropriate representatives as if each of the affected employees were an appropriate representative.”[23]Regulation 15 of TUPE governs who can bring a claim for a failure to inform and consult, the burden of proof and that liability is joint and several as between the transferor and transferee, as follows. “15.— Failure to inform or consult (1) Where an employer has failed to comply with a requirement of regulation 13 or regulation 14, a complaint may be presented to an employment tribunal on that ground— (a) in the case of a failure relating to the election of employee representatives, by any of his employees who are affected employees; Case No: 6005480/2024 8 (b) in the case of any other failure relating to employee representatives, by any of the employee representatives to whom the failure related; (c) in the case of failure relating to representatives of a trade union, by the trade union; and (d) in any other case, by any of his employees who are affected employees. … (3A) If on a complaint under paragraph (1), a question arises as to whether or not regulation 13A applied, it is for the employer to show that the conditions in sub-paragraphs (a) and (b) of regulation 13A(1) applied at the time referred to in regulation 13A(1). (4) On a complaint under paragraph (1)(a) it shall be for the employer to show that the requirements in regulation 14 have been satisfied. (5) On a complaint against a transferor that he had failed to perform the duty imposed upon him by virtue of regulation 13(2)(d) or, so far as relating thereto, regulation 13(9), he may not show that it was not reasonably practicable for him to perform the duty in question for the reason that the transferee had failed to give him the requisite information at the requisite time in accordance with regulation 13(4) unless he gives the transferee notice of his intention to show that fact; and the giving of the notice shall make the transferee a party to the proceedings. (6) In relation to any complaint under paragraph (1), a failure on the part of a person controlling (directly or indirectly) the employer to provide information to the employer shall not constitute special circumstances rendering it not reasonably practicable for the employer to comply with such a requirement. (7) Where the tribunal finds a complaint against a transferee under paragraph (1) well-founded it shall make a declaration to that effect and may order the transferee to pay appropriate compensation to such descriptions of affected employees as may be specified in the award. (8) Where the tribunal finds a complaint against a transferor under paragraph (1) well-founded it shall make a declaration to that effect and may— (a) order the transferor, subject to paragraph (9), to pay appropriate compensation to such descriptions of affected employees as may be specified in the award; or (b) if the complaint is that the transferor did not perform the duty mentioned in paragraph (5) and the transferor (after giving due notice) shows the facts so mentioned, order the transferee to pay appropriate compensation to such descriptions of affected employees as may be specified in the award. (9) The transferee shall be jointly and severally liable with the transferor in respect of compensation payable under sub-paragraph (8)(a) or paragraph (11).[24]Under regulation 16(3) of TUPE “appropriate compensation” in regulation 15 of Case No: 6005480/2024 9 TUPE is defined as “such sum not exceeding thirteen weeks' pay for the employee in question as the tribunal considers just and equitable having regard to the seriousness of the failure of the employer to comply with his duty”. Discussion and conclusions Constructive dismissalDiscussion and conclusions
[25]Despite the fact that the Claimant sent a letter purporting to resign to the First Respondent, I find that the Claimant’s employment contract continued in force.[26]The Claimant’s work for the end client did not cease. He continued to work on the same contractual terms and for the same pay with no break. On that basis, I consider that there was a service provision change under Regulation 3(1)(b)(ii) from the First Respondent to the Claimant’s new third party employer. The Claimant’s services ceased being provided by the First Respondent and began being provided by the new third party employer to the same end client, with the Claimant moving across from one to the other on the same contractual terms.[27]This complaint is not well founded and is dismissed. TUPE[28]The parties agree that there was a relevant transfer under TUPE from the First Respondent to the Second Respondent.[29]On the Second Respondent’s own evidence, 200 employees were transferred from the First Respondent to the Second Respondent. The Claimant was an affected employee as his employment was intended to transfer. On the Second Respondent’s evidence, no employee representatives were in place and none were elected for the purposes of the obligations under Regulations 13 and 14 of TUPE to inform and consult employees. None of the exceptions set out in Regulation 13A of TUPE applied to permit information and consultation to take place directly with affected employees, rather than with representatives. The First Respondent was responsible for inviting affected employees to elect appropriate employee representatives. It did not do so. As such, there has been a failure to inform and consult employee representatives in breach of Regulations 13 and 14 of TUPE.[30]The Claimant was an employee affected by the transfer, as his employment was to be transferred on 17 May 2024 from the First Respondent to the Second Respondent. As such, he has standing under Regulation 15(1)(a) of TUPE to bring a complaint in the employment Tribunal for a failure relating to the election of employee representatives.[31]This complaint is well-founded and is upheld.Remedy
[32]Where there has been a failure to inform and consult, “appropriate compensation” in Regulation 15 of TUPE is defined in Regulation 16(3) of TUPE as “such sum not exceeding thirteen weeks' pay for the employee in Case No: 6005480/2024 10 question as the tribunal considers just and equitable having regard to the seriousness of the failure of the employer to comply with his duty”.[33]The parties agree that the Claimant’s gross weekly pay at the relevant time was £2,750 per week.[34]13 weeks’ pay is the starting point for compensation for a failure to inform and consult, but the Tribunal has a wide discretion to award compensation that is just and equitable in the circumstances. It is a punitive award and is not compensatory.[35]I found that there was a complete failure to elect employee representatives and that the Claimant had not received the letter sent directly to affected employees on 10 May 2024 with information about the transfer. The Claimant was made aware of the transfer and how that would affect him (namely the “measure” in relation to the change of holiday pay provision) by telephone on 15 May 2024. This was two days before the intended transfer date.[36]Taking into account the very minimal compliance with the duty to inform and consult, I considered that in all the circumstances it was just and equitable to award 12.5 weeks’ pay. 12.5 weeks multiplied by weekly pay of £2,750, meant that I made an award in the sum of £34,375 (gross). Approved by