Gibbs & Ors v. Riley Builders [1999] UKEAT 26_99_1203

EAT

Gibbs & Ors v. Riley Builders

[1999] UKEAT 26_99_1203 · 1999-03-12

"The unanimous decision of the Tribunal is that the applicant's reference under Section 11 of the Employment Rights Act 1996 fails. The complaint by the applicant, Mr Church, for a redundancy payment also fails and is dismissed."

There is now an appeal by the unsuccessful Applicants to this Tribunal. Our task this morning is to seek to identify, if such there be, an arguable point of law. If there is such a point of law we will direct that the matter goes forward for a hearing at which the Respondents are represented. If we can discern no such point of law, then we will dismiss the appeal.

Turning then to the merits of the matter, one starts with the description of the issues set out by the Employment Tribunal in paragraphs 1 and 2 of the Extended Reasons:

"1. In this case by applications presented by nine individuals on 3 April 1998 the individuals, who were formerly associated with Brock Builders but who commenced as employees with the respondent on 6 October 1997, seek a declaration under Section 12 of the Employment Rights Act 1996 that their statement of particulars of terms of employment supplied to them pursuant to Section 1 of the Act should be amended to show that their continuous service goes back to the date on which they commenced their association with Brock Builders because there had been a transfer of an undertaking enabling them to have continuous service. The respondent replied to that by saying that there was no transfer of a business and that, therefore, there was no continuity of service but, if they were wrong about that, Messrs Jones and Comerford were not employed in the part transferred, that Messrs Jones, Comerford and Miller were not employees capable of being transferred and that the other six were not employed at the time of the transfer because they had resigned with effect from 3 October. One employee, Mr Church, amended his claim from unfair dismissal to a claim for a redundancy payment and it is common ground that if he has continuity of service pursuant to a transfer he is entitled to a redundancy payment.

2. Those are the issues. The facts are that the applicants worked for Brock Builders for varying periods of up to five or six years. During the last three years those that were employed were carrying out day-to-day maintenance of council owned properties on the Urban South Area of the Gt Yarmouth Borough Council responsibility. Messrs Jones and Comerford were working as sub-contractors principally on a different contract, namely, the programmed maintenance contract, but occasionally when the need arose they helped on the day-to-day maintenance side."

In the next ensuing paragraphs of the Extended Reasons the Tribunal makes findings as to the circumstances in which the Applicants came to work for the Respondents, Riley Builders. Essentially, as they find, Brock lost the contract that they had with respect to the Urban South Area and Riley Builders took over from them.

There therefore came about a situation in which there was a movement of employees from Brock to Riley Builders. We need not get further into the details of the matter, it is set out very clearly in the paragraphs 3 to 5 inclusive of the Extended Reasons. In paragraph 6 they set out further findings of fact relating to the evidence that they heard and then in paragraph 7 the Tribunal directs itself as follows:

"7. The law which we have to apply is this: the references made to us is under Section 11 of the Employment Rights Act 1996 which can be made when an employee considers that the terms of employment which he has received are incorrect and by Section 12 of the Act a Tribunal may either confirm the particulars which are included or amend those particulars or substitute other particulars for them. It is the case here that the applicants are seeking that we amend one part of the terms and conditions which is headed:

'paragraph 4 - You have not had employment with a previous employer which under the Act counts as continuous with your current employment'

The applicants seek an amendment to that."

In the next following paragraphs the Tribunal sets out its understanding of the legal position. It directs itself that the question, as to whether there was continuity of employment is covered by Section 218 of the Employment Rights Act, whereby it is provided that:

"(2) If a trade or business, or an undertaking ... is transferred from one person to another - (a) the period of employment of an employee in the trade or business or undertaking at the time of the transfer counts as a period of employment with the transferee, and (b) the transfer does not break the continuity of the period of employment."

The Tribunal then goes on to direct itself by reference to case law as to the principles that apply to reach an adjudication in this matter and that, in its turn, leads to the two paragraphs that are crucial for the purposes of this appeal:

"9. The two questions which we have to ask ourselves in this case is firstly, was this an economic entity capable of being transferred and, secondly, was there a transfer so that it retained its identity in the respondent's hands. We consider here that there was an economic entity which was capable of being transferred but we have to look carefully at the question of whether it did transfer. In favour of a transfer we have the fact that the majority of the workforce did take jobs with the respondent; we have the fact that the stock was purchased by the respondent; we have a negotiation which resulted in the respondent using the same depot that the outgoing contractor had used and we have the fact that the work of day-to-day maintenance is consistent under both contracts. On the other hand we have the fact that no plant or equipment was transferred, such as vans and cement mixers etc; no management was transferred; the new contractor took on a greatly enhanced area under the new contract; the old contractor in running the depot also ran from that depot the planned maintenance contract which it also had and that that planned maintenance contract was retained. We also have the fact that the old contractor Brocks informed the workforce that it would continue to employ them albeit on different work. Finally we see that the other contractors involved, Messrs Neve Builders and Gt Yarmouth's own in-house team, who lost their contract, redeployed their own workers elsewhere.

10. Balancing those factors and standing back and looking at the activities as a whole, we do not consider that the entity retained its identity in the respondent's hands. We consider that there was a significant change and this was more akin to one business losing part of a contract and a different business acquiring a new customer. There were different requirements: a whole different area of council properties was covered; planned cyclical maintenance which was a contract held by the old contractor continued to be carried out by the old contractor; the old contractor's building business continued and an offer of work in that other area was offered to the employees. So balancing the factors as a whole we do not consider that there was a transfer of an undertaking and, therefore, we cannot accede to the submission made by the applicants that their terms of employment should be amended to include continuous employment with Messrs Brocks."

On behalf of the Appellant, Mr Tobin seeks to persuade us that a question of law can be discerned from those two paragraphs. He draws attention to certain errors that he identifies in the recital of the facts, and he submits that the conclusion reached by the Employment Tribunal was in effect so perverse that this matter could, and should, be looked at by this Tribunal with the benefit of an inter partes hearing.

We have no hesitation in rejecting that submission. We pay tribute to the Extended Reasons of this Employment Tribunal. We pay tribute to the content and to the way in which the Tribunal carefully directed itself, as to law and as to fact, so as to be able to reach its conclusions in the manner set out in the two paragraphs just cited. We cannot fault, in any way, their approach. They were acting classically as an industrial jury, balancing the facts that were put before it in order to arrive at the decision that the law required them to make.

We can find no fault at all in their process, such as to amount to a question of law. Thus it is, there is no basis for an inter partes hearing. Thus it is further, we have to dismiss this appeal and we do so.