UKEATS/0007/08/MT v UCATT [2008] UKEAT 0007_08_1911

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2008] UKEAT 0007_08_1911Case No Appeal No. UKEATS/0007/08/MT, UKEATS/0014/08/MTVenue 52 MELVILLE STREET, EDINBURGH, EH3 7HF
Between
UKEATS/0007/08/MTUCATTAPPELLANT1)AMICUS 2) TGWU 3) GLASGOW CITY COUNCIL 4) CITY BUILDING (GLASGOW) LLPRESPONDENTSUKEATS/0014/08/MT1) AMICUS 2) TGWUAPPELLANT1) UCATT 2) GLASGOW CITY COUNCIL 3) CITY BUILDING (GLASGOW) LLPRESPONDENTS
Before
Lady SmithDate 19 November 2008
[1]APPEARANCES UKEATS/0007/08/MT For the Appellants (UCATT) MR JAMES PEOPLES (One of Her Majesty's Counsel) Instructed by: Messrs Dallas McMillan Solicitors 1st Floor Regent Court 790 West Regent Street Glasgow, G2 2QZ For the First and Second Respondents (AMICUS and TGWU) MR NAPIER (One of Her Majesty's Counsel) Instructed by: Messrs Thompsons Solicitors Berkeley House 285 Bath Street Glasgow G2 4HQ For the Third Respondent (Glasgow City Council) MR TRUSCOTT (One of Her Majesty's Counsel) Instructed by: Glasgow City Council Litigation & Employment Section George Square Glasgow G2 1DU For the Fourth Respondent (City Building (Glasgow) LLP) THOMAS LINDEN (One of Her Majesty's Counsel) Instructed by: Messrs Shepherd & Wedderburn Solicitors 155 St Vincent Street Glasgow G2 5NR APPEARANCES UKEATS/0014/08/MT For the First and Second Appellant s (AMICUS and TGWU) MR NAPIER (One of Her Majesty's Counsel) Instructed by: Messrs Thompsons Solicitors For the First Respondent (UCATT) MR JAMES PEOPLES (One of Her Majesty's Counsel) Instructed by: Messrs Dallas McMillan Solicitors For the Second Respondent (Glasgow City Council) MR TRUSCOTT (One of Her Majesty's Counsel) Instructed by: Glasgow City Council Litigation & Employment Section For the Third Respondent (City Building (Glasgow) LLP THOMAS LINDEN (One of Her Majesty's Counsel) Instructed by: Messrs Shepherd & Wedderburn SUMMARY TRANSFER OF UNDERTAKINGS: Consultation and other information TUPE 2006.(1) Whether Tribunal had erred in refusing to allow UCATT to amend its claim to add an allegation of failure to inform in accordance with reg.13(2) in addition to its existing allegation of failure to consult.(2) Whether regulations require a transferee employer to consult with transferred employees post transfer regarding measures it envisages in relation to them. On appeal , EAT found that the Tribunal had not erred in refusing to allow UCATT to amend its claim. Further, it agreed with the Tribunal that the transferee employers were not obliged to consult with the transferred employees post transfer. Proposal that there should be a reference to the ECJ rejected. THE HONOURABLE LADY SMITH INTRODUCTION This is an appeal from a judgment of an Employment Tribunal sitting at Glasgow, Chairman Mr R M Williamson, registered on 24 October 2007.[2]In terms of that judgment, the tribunal refused to allow UCATT, the third claimant, to amend its claim form. It also determined, with regard to the claims of three unions (UCATT, AMICUS and TGWU) that the employer to whom members of their unions were transferred, City Building (Glasgow) LLP ('LLP'), the second respondents, had no obligation under the Transfer of Undertakings Protection of Employment Regulations 2006 (' TUPE ') to consult with the unions after the date that the transfer was completed in respect of any envisaged measures that might affect transferred employees. The employees were transferred to LLP from the employment of City of Glasgow Council ('CGC'), the first respondents.[3]AMICUS and TGWU were represented by Mr Napier QC before the Tribunal and before me. UCATT was represented by Mr O'Carroll, advocate, before the Tribunal and by Mr Peoples QC before me. CGC were represented by Mr Truscott QC before the Tribunal and before me. LLP were represented by Mr Hand QC before the Tribunal and by Mr Linden QC before me. BACKGROUND[4]In 2006, CGC decided to transfer its Building Services Division to LLP. LLP was incorporated on 14 July 2006 but had no employees until about two thousand employees, including members of the three claimant unions, were transferred to it from CGC at 17.00 hours on 6 October 2006. From time to time between 26 July 2006 and 6 October 2006, three of CGC's employees acted as agents for LLP in respect of its affairs.[5]UCATT presented a claim to the Employment Tribunal on 20 December 2006. It was said to cover a list of identified employees. The complaint is stated to be:
"FAILURE TO CONSULT UNDER THE TRANFER (sic) OF UNDERTAKING (PROTECTION OF EMPLOYMENT) REGULATIONS 2006 THE COUNCIL (GLASGOW CITY COUNCIL) TRANSFERRED THE WORKFORCE TO LIMITED LIABILITY PARTNERSHIP AND FAILED IN THEIR OBLIGATION TO CONSULT WITH THE TRADE UNION"
[6]On 12 February 2007, five weeks after the expiry of the three month time limit for lodging claims (see: TUPE reg. 15(12)), UCATT's solicitors wrote to the Tribunal indicating that it wished to amend its claim as follows:
"1. By insertion of the words 'inform' between the word "to" and the word "consult" 2. By adding at the end the following: "
With regard to the Respondents defence, it is admitted that the TUPE transfer took place on 6 October 2006. It is denied that neither the Council nor the LLP envisaged taking measures in connection with the transfer in relation to any affected employees. It is denied that on 20 September 2006 the Council wrote to all employees including the Claimants representatives. The Claimants did not receive said letter of 20 September 2006. In any event said letter did not comply with the requirements on information set out in Regulation 13(2) of the 2006 Regulations. In particular said letter did not set out the reasons for the TUPE transfer or did not set out the measures which Glasgow City Council envisaged would be taken (or alternatively that they envisaged no such measures) nor did it set out the measures which it envisaged the LLP would take in relation to any affective (sic) employees (or that they envisaged no such measures would be taken). It is denied that prior to said letter of 20 September 2006 the Claimants had been informed of the information required under Regulation 13(2). Furthermore the Respondent had the obligation to consult and failed meaningfully to do so. As a result of the absence of dialogue, the Claimants met with the Respondents on 2 October 2006 and at that time presented a list of twelve areas which the claimants thought would be affected by the TUPE transfer. The Respondents did not discuss the lists at the meeting. They responded by a letter of 2 October and there was no discussion of the points raised."[7]The Employment Tribunal replied by letter dated 20 February 2007 in which UCATT's solicitors were asked to confirm whether they had complied with rule 11(4) of the Employment Tribunals (Constitution and Rules etc) Regulations 2004 ('the Tribunal Rules') . They had not in fact fulfilled all their obligations under that rule; no intimation of their application had been sent to the LLP's legal representatives despite the fact that they had lodged a response to the claim on 1 February 2007. Nor did they reply to the Tribunal's letter of 20 February 2007. No further steps were taken by UCATT in relation to their application to amend until 11 September 2007 when their solicitors wrote to the Tribunal again. They acknowledged their oversight and asked to renew their application to amend.[8]Following receipt of UCATT's application to amend, LLP intimated an application for an order to strike out its claim against them. On being notified of that application, UCATT's solicitors wrote to the Tribunal by letter dated 21 September 2007.

(g) ), they stated:

"It is accepted that the Second Respondents were not obliged to consult post – transfer. We do not claim any such obligation. "
[9]AMICUS presented a timeous claim to the Employment Tribunal in which it complained of a failure by both respondents to inform and consult them, as they were obliged to do under regulation 13 of TUPE.[10]TGWU presented a timeous claim in which it made the same complaint as was made by AMICUS.[11]The three cases were conjoined and set down for a hearing to begin on 1 October. LLP's application for a strike-out order was outstanding at that stage. It was not the only issue to be determined. Parties sensibly agreed that the first day of the hearing should be designated as a case management discussion and thereafter they proceeded to a pre–hearing review to determine two issues.[12]The first issue that the Tribunal required to determine was whether or not UCATT's outstanding application to amend (the application first intimated in their letter of 12 February) should be granted. RELEVANT LAW Amendment[13]Under and in terms of paragraph 10(2)(q) of the Tribunal Rules, it is specifically provided that the tribunal's power to manage cases includes the power to give leave to amend a claim. The decision whether or not to allow an amendment is a discretionary one. As with all such exercises of discretion, the decision can only be interfered with if the order was not within the powers given to the tribunal or the discretion was not exercised within guiding legal principles or it can be attacked on the principles in Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1KB 223 (see: Adams and Raynor v West Sussex County Council [1990] IRLR 215 and Amey Services Ltd & ors v Cardigan & ors [2008] IRLR 279 ; the latter subject to the observation that there is a patent error in the syntax of paragraph 15 which should in fact have accorded with the foregoing statement).[14]Cocking v Sandhurst Ltd [1974] ICR 650 is generally regarded as the leading authority on amendments in claims before the employment tribunals. It stressed the need to have regard to all the circumstances of the case and to take account of any injustice or hardship which might be caused to any party. The authoritative status of Cocking was confirmed by the Court of Appeal in British Newspaper Printing Corporation (North) Ltd v Kelly & Ors [1989] IRLR 222.[15]The guidance set out in Selkent Bus Co Ltd v Moore [1996] ICR 836 regarding amendments is well known and I do not propose to set it out at length. It is though, of relevance for the present case to note what is set out at point 5(b) in the guidance list, at p.843:
" (b) The applicability of time limits. If a new complaint or cause of action is proposed to be added by way of amendment, it is essential for the tribunal to consider whether that complaint is out of time and, if so, whether the time limit should be extended under the applicable statutory provisions."
[16]The position is that an employment tribunal has a discretion in any case to allow an amendment which introduces a new claim out of time but it must, obviously, take account of the lateness and also of whether had it been an entirely fresh claim, the claimant would have been in a position to satisfy the tribunal that it was appropriate to extend the time limit. The answer to that question could, depending on the circumstances of the individual case, be decisive. As was commented by Underhill J in TGWU v Safeway Stores Ltd UKEAT/0092/07/LA , at p.10:
"… the reason why it is 'essential' that a tribunal consider whether the fresh claim in question is in time is simply that that is a factor – albeit an important and potentially decisive one - in the exercise of the discretion."
[17]Also of assistance is the reminder, in the first paragraph of the conclusion in Selkent , that the question of amendment should be considered in the light of the circumstances existing at the date when the application was made.[18]The second issue that the Tribunal required to determine was whether or not regulation 13(6) of TUPE requires transferee employers to consult, post transfer, with the representatives of transferred employees in the event that the transferee envisages taking measures in relation to any such employees that are connected with the transfer.[19]It was agreed that both issues would be determined on the hypothesis that the taking of relevant measures had been envisaged by LLP. Were matters to proceed further, however, the claimants would have to establish that that was in fact the case. I do not understand any concessions to have been made by either respondent in that regard. The Directive[20]TUPE was made under the European Communities Act 1972 in order to implement Council Directive 2001/23/EC ('the Directive') on the approximation of the laws of the Member States relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses. It is, accordingly, necessary to refer to the Directive to understand how TUPE is to be interpreted. In Wilson v St Helen's Borough Council [1998]. IRLR 706 HL, where Lord Slynn of Hadley said:
"It is common ground that, both under English law and under Community law, the national court should construe a regulation adopted to give effect to a Directive as intended to carry out the obligations of the Directive and as not being inconsistent with it if it is reasonably capable of bearing such a meaning: see Garland v British Rail Engineering Ltd 1982. IRLR 111 and Litster v Forth Dry Dock & Engineering Co Ltd 1989 IRLR 161 . In von Colson v Land Nordrhein – Westfalen (case 14/83) 1984. ECR 1981, 1909, paragraph 26 the European Court of Justice said that, pursuant to member states' obligations under Article 5 of the EEC Treaty (Cmnd. 5197 –II): 'national courts are required to interpret their national law in the light of the working and the purpose of the Directive in order to achieve the result referred to in the third paragraph of Article 189.'"
[21]The history of the Directive is that it was preceded by Directive 77/187 which was amended by Council Directive 98/50/ EC. Both the 1977 and 1998 Directives were subsequently repealed and replaced by the Directive; it was a codifying measure.[22]The provisions of the Directive that are relevant for present purposes are as follows:
"… Whereas: … (3) It is necessary to provide for the protection of employees in the event of a change of employer, in particular, to ensure their rights are safeguarded. . .. CHAPTER II SAFEGUARDING OF EMPLOYEES' RIGHTS Article 3 1. The transferor's rights and obligations arising from a contract of employment or from an employment relationship existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee. … Article 4 1. The transfer of the undertaking, business or part of the undertaking or business shall not in itself constitute grounds for dismissal by the transferor or the transferee. This provision shall not stand in the way of dismissals that may take place for economic, technical or organisational reasons entailing changes in the workforce. … 2. If the contract of employment or the employment relationship is terminated because the transfer involved a substantial change in working conditions to the detriment of the employee, the employer shall be regarded as having been responsible for termination of the contract of employment or of the employment relationship. … CHAPTER III INFORMATION AND CONSULTATION Article 7 1. The transferor and transferee shall be required to inform the representatives of their respective employees affected by the transfer of the following – - the date or proposed date of the transfer, - the reasons for the transfer, - the legal, economic and social implications of the transfer for the employees, any measures envisaged in relation to the employees. The transferor must give such information to the representatives of his employees in good time, before the transfer is carried out. The transferee must give such information to the representatives of his employees in good time, and in any event before his employees are directly affected by the transfer as regards their conditions of work and employment. 2. Where the transferor or the transferee envisages measures in relation to his employees, he shall consult the representatives of his employees in good time on such measures with a view to reaching an agreement. 3. Member States whose laws, regulations or administrative provisions provide that representatives of the employees may have recourse to an arbitration board to obtain a decision on the measures to be taken in relation to employees may limit the obligations laid down in paragraphs 1 and 2 to cases where the transfer carried out gives rise to a change in the business likely to entail serious disadvantages for a considerable number of the employees. The information and consultations shall cover at least the measures envisaged in relation to the employees. The information must be provided and consultations take place in good time before the change in the business referred to in the first subparagraph is effected. … 6. Member States shall provide that, where there are no representatives of the employees in an undertaking or business through no fault of their own, the employees concerned must be informed in advance of – - the date of the proposed transfer, - the reason for the transfer, - the legal, economic and social implications of the transfer for the employees, - any measures envisaged in relation to the employees. … Article 9 Member States shall introduce into their national legal systems such measures as are necessary to enable all employees and representatives of employees who consider themselves wronged by failure to comply with the obligations arising from this Directive to pursue their claims by judicial proves after possible recourse to other competent authorities."
TUPE[23]Turning to TUPE, the relevant regulations are:
" 4. Effect of relevant transfer on contracts of employment (1) Except where objection is made under paragraph (7), a relevant transfer shall not operate so as to terminate the contract of employment of any person employed by the transferor and assigned to the organised grouping of resources or employees that is subject to the relevant transfer, which would otherwise be terminated by the transfer, but any such contract shall have effect after the transfer as if originally made between the person so employed and the transferee. (2) Without prejudice to paragraph (1), but subject to paragraph (6), and regulations 8 and 15(9), on the completion of a relevant transfer – (a) all the transferor's rights, powers, duties and liabilities under or in connection with any such contract shall be transferred by virtue of this regulation to the transferee; and (b) any act or omission before the transfer is completed, of or in relation to the transferor in respect of that contract or a person assigned to that organised grouping of resources or employees shall be deemed to have been an act or omission or in relation to the transferee. … (7) Paragraphs (1) and (2) shall not operate to transfer the contract of employment and the rights, powers, duties and liabilities under or in connection with it of an employee who informs the transferor or the transferee that he objects to becoming employed by the transferee. … 13. Duty to inform and consult representatives (1) In this regulation and regulations 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 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 taken, that fact. … (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). … (6) An employer of an affected employee who envisages that he will take 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. … (9) If in any case there are special circumstances which render it not reasonably practicable for an employer to perform a duty imposed on him by any of paragraphs (2) to (7), he shall take all such steps towards performing that duty as are reasonably practicable in the circumstances. … 15 Failure to inform or consult (1) Where an employer has failed to comply with a requirement of regulation 13 or 14, complaint may be presented to an employment tribunal on that ground – … (12) An employment tribunal shall not consider a complaint under paragraph (1) … unless it is presented to the tribunal before the end of the period of three months beginning with – (a) in respect of a complaint under paragraph (1), the date on which the relevant transfer is completed … … or within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented before the end of the period of three months."
[24]It was common ground amongst parties that both the Directive and TUPE provided for the giving of the specified information by the transferor employer to all those employed by it pre-transfer (including but not restricted to the group of employees liable to be transferred) and by the transferee employer to all those employed by it pre-transfer. Similarly, it was not disputed that both the Directive and TUPE provide for each employer to be under an obligation to consult with their own employees, pre-transfer regarding any measures that either of them envisage taking in connection with the transfer, prior to the transfer. It was not suggested that either employer had an obligation to consult the employees of the other. Where the claimants and respondents part company is when it comes to the issue of whether the transferee employer has a further duty to consult after the transferors' employees have been transferred to it, with those employees, regarding any measures which it envisages taking in connection with the transfer that might affect that new cohort of its workforce.[25]For completeness, I note that neither the Directive nor regulation 13(2) or (6) oblige either employer to consult regarding the matters specified in subparagraphs (a), (b) or (c) of regulation 13, albeit that it is open to either employer to consult voluntarily on these matters (see: Institute of Civil Servants and others v Secretary of State for Defence [1987] IRLR 373 per Millet J, as he then was, at paragraph 13). 3. Commentaries referred to regarding obligations to inform and consult : 26.. In the course of submissions, a number of commentaries regarding the Directive and its predecessors and TUPE were referred to. Dealing with them chronologically, the first was the European Commission's document containing relevant directive proposals dated 1974 (COM(74) 351 Final/2). At p.10, it observed that the substantive provisions for the protection of workers' acquired rights:
"… need to be supplemented by procedural provisions guaranteeing that workers' representatives should be informed and consulted about the consequences of any merger takeover or concentration." and the proposed draft Article (Article 8) provided: "(1) The transferor and transferee shall be required before carrying out the projected operation, to inform the representatives of their respective workers, within the meaning of Article 7, of the reasons that led them to consider such an operation and also of the legal, economic and social consequences it entails for the workers; they shall, moreover, indicate what measures are to be taken in relation to the workers. If the workers' representatives so request, a discussion shall take place immediately on the content of this information. … (1) The obligation to hold immediate discussions in paragraph 1 … .not to prejudice the operation."
[27]The apparent recognition of a need to refrain from placing employers under consultation duties to an extent which could jeopardise the commercial transaction involved, is worthy of note.[28]In 1997, the European Commission issued, by way of guidance, a 'Memorandum on Acquired Rights of Workers in Cases of Transfers of Undertakings'. In the section on 'Information and Consultation', having referred to the information list that appears in Article 7(1) and regulation 13(2), it states:
"This information must be provided in good time before the transfer is carried out and in any event before the transferee's employees are directly affected by the transfer as regards their conditions of work and employment. Whereas the obligation to provide information is general, the consultation obligation is limited."
The distinction drawn between the extent of the duty to inform and the extent of the duty to consult is also worthy of note.[29]The author of the textbook " TUPE: Law and Practice " (2006), Robert Upex, deals with the obligation to consult at paragraph 5.28. He states that the only consultation to which the representatives of the employees of the transferor are entitled is consultation about any measures that the transferor envisages taking. He observes that the regulations do not oblige the transferor employer to consult the representatives of its employees about any measures that the transferee envisages taking nor do they oblige the transferee employer to make itself available for consultation in respect of such measures. Nothing in his commentary suggests that the transferee has a post transfer obligation to consult with the transferred employees.[30]In 2007, the European Commission issued a report in respect of the Directive. It comments that the Directive:
"… is aimed at protecting a business' employees in the event of a change of employer and, in particular, ensuring that the employees' rights are safeguarded …"
[31]It observes that the transferring employees' rights on transfer are subject to their right not to continue in an employment relationship with the transferee. As regards information and consultation, in common with the guidance memorandum, it observes that whereas the obligation to report is 'general', the obligation to consult is 'limited'. It notes that the obligation to consult arises where:
"the transferor or transferee envisages any measures in relation to the employees (for example a reduction in the workforce). The consultation takes place 'with a view to reaching agreement.'"
[32]Finally, also in 2007, the IDS Employment Law Handbook on ' Transfer of Undertakings ' discussed the obligation to consult contained in TUPE from p.444 onwards. It suggests that regulation 13(6) might be open to interpretation as indicating that the transferee employer is obliged to consult regarding the transferor's employees if relevant measures are envisaged although concludes 'on balance' that the regulations do not require the transferee employer to consult with the representatives of the transferor's employees prior to the transfer. That does not, in the commentator's view, dispose of matters, however. It leaves open the question of whether, since the transferor's employees will be the transferee's employees once transferred, the transferee then and thereafter has a duty to consult. It concludes that regulation 5(12) 'puts a spanner in the works' though and postulates that a court will "take some convincing to upset the applecart and hold that post transfer consultation should take place".[33]In short, none of the commentaries on the Directive and TUPE conclude that the duty contended for by the claimants exists. On the contrary, they indicate that it does not. References to European Court of Justice ('ECJ')[34]The power to refer an issue to the ECJ arises under Article 234 of the Treaty of Rome (ex Article 177). If Community law is critical to the final decision of the domestic court and it is in any real doubt as to the correct resolution of the point raised, then it should ordinarily make a reference. The correct approach was set out by Bingham LJ (as he then was) in R v Stock Exchange ex part Else Ltd , at p.534 and I bear it in mind in considering whether or not there requires to be a reference in this case:
"If the facts had been found and the Community law issue is critical to the court's final decision, the appropriate course is ordinarily to refer the issue to the Court of Justice unless the national courts can with complete confidence resolve the issue itself. In considering whether it can with complete confidence resolve the issue itself the national court must be fully mindful of the differences between national and Community legislation, of the pitfalls which face a national court venturing into what may be an unfamiliar field, of the need for uniform interpretation of throughout the Community and of the great advantages enjoyed by the Court of Justice in construing Community instruments. If the national court has any real doubt, it should ordinarily refer. I am not here attempting to summarise comprehensively the effect of such leading cases as … but I hope I am fairly expressing their essential point."
The Tribunal's Judgment[35]The Tribunal refused the application to amend, expressly as an exercise of its discretion. It referred to the guidance in Selkent Bus Company Ltd v Moore [1996] ICR 836 . It approached amendment on the factual basis that the request to amend was made about five weeks after the expiry of the three month time for lodging a claim for a breach of regulation 13, that there was nothing which made it not reasonably practicable for the claim to have been presented so as to include an allegation of failure to inform within the three month period, and that there would be no prejudice to the respondents if the amendment were to be allowed. Those were the only three matters that were referred to in the course of parties' respective submissions. 36.. As regards the consultation issue, the Tribunal determined:
"… the second respondent City Building (Glasgow) LLP had no obligation by virtue of said Regulations and in particular Regulation 13(6) to consult with the claimant trade unions after the date the transfer was completed in respect of envisaged measures it would take in relation to the employees who transferred to it by virtue of Regulation 4."
[37]The tribunal was persuaded that the framework of the information and consultation part of TUPE was:
"formulated on a pre transfer timetable." and found support for the fact that the time limit for bringing claims starts on the date that the transfer is completed. The tribunal also interpreted Article 7(3) of the Directive as indicating that the information and consultation referred to required to take place before the transfer; it regarded the phrase "change in the business" as synonymous with "date of transfer of the business"
. The tribunal observed that transferring employees have the protection of regulation 4 of TUPE. UCATT's Application to Amend Submissions 38.. For UCATT, Mr Peoples QC submitted that whilst it was within the power of the tribunal to refuse the application, once account was taken of its discretion, of the fact that there is no formal adjustment procedure in tribunal pleadings, of the overriding objective, of the need to take account of all the circumstances, of the lack of prejudice to the second respondents and of the fact that the claim form ET1 was drafted by non lawyers, the Tribunal should have allowed the amendment. The Tribunal had, he submitted, misunderstood the time limit issue and treated it as determinative when it was not.[39]For LLP, Mr Linden QC submitted that the timing of the claim and the application to amend was relevant. Although the Tribunal had, in UCATT's favour, treated the application as though made on 12 February 2007, it was not in fact made until September 2007. Time limits were highly relevant ( Selkent ; TGWU v Safeway Stores Ltd ) . The perversity test was not satisfied. UCATT had made no submission of prejudice to them in the event that the amendment was refused, not that prejudice was the only question. Mr Truscott QC adopted Mr Linden's submissions and observed that the overriding objective had justice to both parties in mind. Further, UCATT had really not advanced any reason at all as to why the discretion to amend should be exercised in its favour. Mr Truscott adopted Mr Linden's submissions and observed that there was no material before the Tribunal which could have justified allowance of the amendment. Decision re: Application to Amend[40]I have no hesitation in rejecting the appeal against the Tribunal's refusal of UCATT's application to amend. UCATT really put forward no reason to the Tribunal for their application to be granted other than the lack of prejudice to the respondents. Such lack of prejudice, if that was a correct analysis (and the Tribunal was prepared to proceed on the basis that it was) cannot, without more, convert into actual prejudice to UCATT, although that seemed to be the thrust of the argument. There was no prejudice to UCATT for the Tribunal to consider. It did consider all the relevant factors. One of those factors was that UCATT were seeking to introduce a new and distinct claim, on the Tribunal's approach, five weeks after the expiry of the time limit set down in regulation 15(12) but, actually, not until over eight months after that date. That time limit could, had it been a new claim, only have been extended if it had not been reasonably practicable to present the claim within three months of the date of transfer. But it was reasonably practicable for UCATT to have done so. Indeed, the other claimants had done so.[41]The Tribunal considered all the relevant factors and had regard to the guidance in Selkent . It cannot be said that it fell into error and its decision was certainly not perverse. To refuse the amendment fell well within the discretion available to it. UCATT'S Participation in the Consultation Case 42.. Before turning to the central issue before me, namely the question of whether or not LLP had a duty to consult post transfer, I require to deal with the question of whether or not UCATT are entitled to participate in that debate and, if resolved in favour of the transferred employees, to benefit from any determination in that regard.[43]Mr Peoples approached this matter as being a question of whether or not UCATT had made a concession to the effect that LLP had no obligation to consult post transfer and, if they had, whether they should be allowed to withdraw it. Mr Linden, on the other hand, approached it on the basis that UCATT had no such claim before the Employment Tribunal or this tribunal and were not, accordingly, in a position to make common cause with AMICUS and TGWU on the matter.[44]The way in which the issue arose will be evident from the narrative in the 'Background' section above. UCATT's solicitors stated, in their letter of 21 September 2007, that they accepted that LLP were not obliged to consult post transfer. Mr Peoples questioned whether, in the context of that letter, which was a response to a strike-out application, it ought properly to be read as a concession. Even if it did, he should be allowed to withdraw it, a matter in which I had a discretion : Secretary of State for Health & anr v Rance [2007] IRLR 665 , Jones v Governing Body of Burdett Coutts School [1999] ICR 38 , Hellyer Bros v McLeod [1987] ICR 526. I should add that, at one point, Mr Peoples sought, though faintly, to suggest that UCATT's ET1 did in fact contain a case that LLP had failed to fulfil its consultation duties. That is, in my view, not a sustainable position. It is quite plain from the terms of the ET1 that the only respondent who is alleged, by UCATT to have failed to consult is CGC. There can be no question of it, either as originally drafted or even including the amendment proposed (but not allowed), being open to being interpreted as indicating that UCATT were seeking to say that LLP had also failed to consult. Nor does it appear that, when they were before the tribunal, UCATT thought that they had instituted a failure to consult claim against LLP since, as is recorded in the tribunal's judgment at paragraphs 23 and 24, their counsel, Mr O'Carroll, recognised that he would need to seek to amend UCATT's claim at a future date if the consultation point was resolved in favour of the transferred employees.[45]Mr Linden, on the other hand, submitted that UCATT had no relevant claim on the consultation issue and questioned its standing to be heard on the matter. They had not only not made such a claim; it had been expressly disavowed. Senior counsel for LLP had drawn attention to that in his written submissions that were presented to the tribunal. Further, if it was to be viewed as a matter of the withdrawal of a concession, there were no special circumstances which justified UCATT being allowed to do so. Mr Truscott again adopted his submissions. Decision re UCATT's Participation in Consultation Case[46]I am persuaded that Mr Linden is correct in his primary argument. The simple fact is that UCATT has no claim against LLP for having failed to consult. It alleges that CGC failed in its duty to consult but has not, at any time, alleged that LLP failed to do so. It also happens to be the case that they have expressly stated in their letter of 21 September 2007 that they do not suggest that LLP had any such obligation, but even without that express statement they would still be in the position of not having presented any claim against LLP in respect of this matter. In these circumstances, I am satisfied that UCATT has no locus to present any argument to the effect that LLP had a duty to consult with it regarding envisaged measures post transfer. The Extent of the Transferee Employer's Duty to Consult Submissions for AMICUS & TGWU:[47]Although Mr Napier initially submitted that the matter was act clair in favour of the unions he represented, he very properly retreated from that position after having listened to the submissions for LLP and CGC and submitted that the matter was such as to require a reference to be made to European Court of Justice. That being so, I do not propose to set out at length the very full submissions made by Mr Napier in his first speech. Rather, I will highlight those parts which could be prayed in aid of his final submission that there should be a reference.[48]Mr Napier advanced an interpretation of the Directive to the effect that the transferee employer's duty of consultation was not restricted to a pre-transfer timetable, in contrast to the transferor's duty to consult, which was. At the heart of his submissions was a proposition that the duties to inform and duties to consult were separate and severable duties. He suggested that the duty to inform of the date of transfer contemplated that information being given either before or after transfer. He suggested that it would be odd if the transferee who envisaged measures pre-transfer had a duty to pass the information about those measures to the transferor employer (reg. 13(4)) but no duty to consult about them. He submitted that the terms of the third paragraph of Article 7(1) were such as to indicate that there was no cut off date of the transfer for the transferee's duties of consultation. Further, the preamble to the Directive showed an intention to go beyond the protection of a transferring employee's contractual rights. Thus, overall, it did appear that the Directive intended to oblige transferee employers to consult with the transferred employees post transfer on measures they envisaged taking. It was not entirely clear whether his argument went as far as to say that they would be obliged to consult regarding measures in connection with the transfer that the transferee first envisaged taking prior to the transfer date. It was though no part of Mr Napier's submission that the Directive intended that transferee employers consult with employees who entered their employment (after the transfer date) regarding relevant measures.[49]Mr Napier then submitted that the regulations could be interpreted purposively, without distortion, to the effect that the consultation obligation for which he argued, arose. He was conscious of the difficulty presented by his proposition that the duties to give information and to consultation ought not to be regarded as linked but submitted that it was possible to have dislocation between them without distortion of the regulation. Similarly, he recognised the force of the argument that regulation 15(12) made it clear that the regulations did not provide for post transfer consult by the transferee employer but submitted that the regulation provided for a primary time limit and although it was not a perfect solution, the ability to allow for an extension on the grounds set out, enabled the regulation to be read as complying with what he said was the intention of the Directive. Mr Napier also submitted that the terms of Article 7(3) were such as to indicate that the Directive intended that there be post-transfer consultation by the transferee. Contrary to what was said by the tribunal, its terminology supported rather than negated that proposition. Submissions for LLP and CGC:[50]Mr Linden submitted that it was clear that the Directive did not point to the conclusion that the transferee employer had the duty to consult argued for by the unions. So far as the duty to consult was concerned, it plainly fell to be interpreted as looking forward to the date of transfer. The information provisions contemplated provision of the required information pre transfer. It did not provide for a post transfer duty to inform. Without such a duty, how could any meaningful consultation take place? He compared the provisions of s.188 of the Trade Unions and Labour Relations Act 1992 which make plain the importance of providing information to enable meaningful consultation to take place where redundancies of 20 or more employees are envisaged. As had been observed in the IPCS v Ministry of Defence case, the point of the giving of information is to enable consultation to take place. The two are inextricably linked.[51]The assumption of the Directive was that transferring employees would transfer on their existing terms and conditions and were required to be protected against dismissal on grounds of the transfer and any substantial change in their working conditions. The wording of the preamble and the tenor of the Directive emphasised that it was concerned with the protection of employees' rights: Foreningen AF Arbejdsledere I Danmark v Daddy's Dance Hall A/S [1988] IRLR 315 ; Wilson v St Helen's Borough Council . Chapter III of the Directive dealt not with rights but with the interests of those who did not have the rights conferred by Chapter II. The consultation duty proposed by the claimants did not relate to the protection of rights[52]The implications of the unions' argument would be that if at any time post-transfer, months or perhaps years later, the transferee employer envisaged taking measures which could be said to be in connection with the transfer and could affect his employees, he required to consult. Further, it appeared that the logical extension of the unions' argument would also be that such an employer could not safely put any measures in connection with the transfer, into effect in advance of the transfer, even if it had consulted with its existing workforce about them, because it required to wait and consult with the transferring employees about them once they had transferred into its employment. That would be wholly unworkable. It would mean that the transferee would be prevented, for example, from setting up a new workplace in anticipation of having a larger workforce. Further, it did, notwithstanding the unions' disavowal of any such argument, appear that the logical extension of their argument would be that the consultation duty would extend not only to the transferred employees but to any other employee who joined the transferee post transfer. It was not, however, for TUPE to continue to control the transferee's operation of its employee relationships post transfer. Domestic law made other provision for the protection of their rights.[53]Mr Linden relied on the provisions of regulation 15(12) as showing that the drafter of TUPE had, correctly, interpreted the Directive as intending that the obligations imposed be cut off as at the date of transfer. He also referred to the obiter comments in the cases of Sweetin v Coral Racing [2006] IRLR 252 and South Durham Health Authority v Unison [1995]. ICR 495 to the effect that the duty to consult does not extend beyond the transfer date and submitted that they were correct.[54]Mr Truscott, in adopting Mr Linden's submissions, stressed that if the unions were correct, employment relationships would, effectively, be stifled. It would give the transferred employees a right to be consulted, potentially hampering progress and development, even though they could rest assured that their terms and conditions of contract were protected and could not be changed on account of the transfer. The fact that a court could look, in the fullness of time, at whether the proposed measure was, in truth, causally linked to the transfer, was not the point. Neither the Directive nor could be interpreted as showing that the transferee employer is to have a duty to consult on non contractual matters. Discussion and Decision re: Consultation Issue:[55]I begin by considering the terms of the Directive. I agree that the terms of the preamble are such as to focus on the protection of employees' rights in the event of a transfer of undertaking taking place. I also accept that, in some respects, the Directive goes further in that it looks to the interests of all the transferor's employees, not just those who are to transfer and in the interests of any pre-existing employees of the transferee. I do not, however, as I will seek to explain, accept that the Directive intends, so far as the transferring employees are concerned, to go any further than protecting their rights not to have their contracts of employment undergo change by reason of the transfer.[56]Chapter II concerns the safeguarding of the rights of employees who are transferred. Without these provisions, such employees would be vulnerable to the risk of losing their jobs, without recourse to a remedy, by reason of the transfer. The Directive thus identifies the need for Member States to make provision for the transfer to the new employer of all the transferor employers' obligations and of the rights under their contracts of employment (Article 3).[57]Chapter III of the Directive is not about the conferring of rights. It provides for the communication of information. Further, in certain circumstances, there is to be consultation. As regards the provision of information, Article 7(1) is plainly forward looking. I do not accept Mr Napier's submission that the reference to "the date" could be interpreted as meaning that the requirement could be to inform employees of a date that has passed. It would be illogical to interpret it that way and, moreover, the French text refers to "la date fixée". The matters set out in the information list make sense as being matters that all three groups of employees ought, in fairness, to be told about prior to the transfer. So far as the transferring employees are concerned, they have an important decision to make. Are they going to go along with the transfer or are they going to object to being transferred to the transferee employer? They need such information about the forthcoming transfer as can reasonably be expected to be made available to them. The list in Article 7(1) is a list of such matters as it is reasonable for such an employee to expect to be told in advance of the transfer. The last point at which such an employee can object is immediately before the transfer. The last point at which conditions as between transferor and transferee could have any prospect of being changed as a result, for instance, of taking account of employee representations, will be the date of transfer. If, for example, the transferor's employees, including the group liable to be transferred, consider that they would be in a better position if the transfer took place on or after a date other than the fixed or proposed transfer date, they need to know that date before it occurs so as to consider whether they should seek to make representations in that regard.[58]I have considered carefully whether the third paragraph of Article 7(1) falls to be read as indicating an intention that the transferee's obligation to inform extends post transfer. I can see that that could be a literal interpretation of it if it is considered standing alone and is read out of context. There would, however, be no sense in the transferee employer being obliged to tell all his employees after the transfer of what date had previously been fixed or proposed for the transfer; the actual date might have turned out to be a date that was neither of these. There would, equally, seem to be little point in allowing the transferee employer to fulfil his obligations by telling his employees after the transfer what the reasons for it had been or only at that stage of the legal, economic and social implications of the transfer for them. Its existing employees need to know of these matters in advance if they are to have a chance of persuading the transferee employer to seek to restructure the transaction so as to take account of their interests.[59]Further, as regards measures which the transferee envisages taking in connection with the transfer, that would, obviously, include changes which are to put into effect in advance of the transfer for the purpose of being able, in practice, to achieve the transfer. The acquisition of new premises and a consequential geographical move of the workforce is an example. Numerous others spring to mind. Thus, so far as measures are concerned, the employees of the transferee need to know about what is proposed not just before the date of transfer but before the change that the envisaged measure will bring about, takes place. The need to provide for that eventuality explains why the third paragraph of Article 7(1) obliges the transferee employer to provide the information prior to the measure taking effect; if it only obliged the transferee to provide the information by the date of the transfer, it could be advice to the employees of a fait accompli, not of a matter about which they could then meaningfully consult. It is evidently also for that reason that Article 7(3) provides for the transmission of information to be prior to the change in the business, not prior to the date of transfer. I would add that although read literally, the first paragraph of Article 7(3) would seem to suggest that it relates only to a period after transfer has been "carried out" and has already effected a "change in the business", that cannot be right. There would be no point in providing for the provision of information and the duty to consult about a matter which had already taken place and it is clear to me that despite that wording, on a proper interpretation, Article 7(3), in common with Article 7(1), has in mind circumstances in which information requires to be conveyed prior to transfer and prior to any pre transfer changes in business being effected and that consultation is to take place pre-transfer and prior to any such pre-transfer change. Thus, I do not agree with the tribunal that change of business in Article 7(3) is synonymous with 'date of transfer' but I do not, equally, see that it can be meant to refer to a date later than transfer.[60]Article 7(1) does not, accordingly, include an obligation to convey any of the listed points of information, post transfer. Nor does Article 7(3). The entire sense and tenor is of communicative activity as between the transferor employer and its employees pre-transfer and as between the transferee employer and its pre transfer employees not only pre-transfer but prior to any change being effected on account of the forthcoming transfer which might affect them.[61]I turn then to the question of whether the Directive intends that the transferee employer should be obliged to consult post-transfer where it envisages measures in relation to his employees (Article 7(2)) which relate to the transfer and might affect them. The proposition is that, wherever such envisaging occurs post transfer (or, possibly, has been in some sort of continuing existence dating back to a pre- transfer envisaging which has not yet resulted in actual change); Article 7(2) obliges the transferee to consult with the transferred employees. It proceeds on a literal interpretation of Article 7(2), bearing in mind that post-transfer, any reference to the transferees' employees includes those who have transferred. I am not entirely clear why the submission excludes an obligation to consult with any other employees who join the transferee post transfer since I would have thought that if Article 7(2) obliges the transferee employer to consult about measures post transfer, there would not seem to be any particular reason for excluding them. However, I recognise that the unions do not suggest that anyone other than the transferred employees would have the consultation right for which they contend.[62]Turning to Mr Napier's approach, I am not persuaded that there is any real doubt about this issue. I have already explained why I do not accept that Article 7(1) obliges the transferee to provide information post-transfer. That means that Article 7(2) would require to be interpreted as intending that there be consultation in circumstances where there was no prior obligation to provide information. Such consultation would be meaningless. Separately, however, there is a fundamental problem in the proposition advanced for the unions. It is this. The stated purpose of such consultation as is provided for by Article 7(2) is that it be with a view to reaching agreement. Agreement between whom? The answer to that must be between the transferee employer and the transferred employees' representatives. That is, it envisages efforts being made to reach a collective agreement on whatever envisaged measure is consulted about. The purpose of a collective agreement is normally to provide a point of reference for the incorporation into individual contracts of employment of new terms and conditions. However, when it comes to the matter of altering the contract of employment of a transferred employee, the effect of the Directive and of TUPE is, as the ECJ has confirmed, that no alteration, whatever it is, can be of any valid force or effect if the transfer is the reason for it ( Daddy's Dance Hall) . No amount of consultation between the transferee employer and the transferred employees could, accordingly, bring about a change in their contracts of employment if the reason for it was the transfer and it is plain that that would be the reason in an Article 7(2) consultation since consulting about measures envisaged on account of the transfer is what it is all about. The contracts of employment of the non transferring employer of either employer are in a different category, however. They are unaffected by the Directive (and unaffected by TUPE). There could be scope for agreeing changes to their contracts of employment. Consultation may well, in the case of those employees, be helpful and it makes sense to provide for it.[63]Turning to TUPE, I am satisfied that the regulations fulfil what the Directive intended. Despite the fact that, as discussed by the authors of the IDS article referred to, on a literal meaning of regulation 13(6), it could apply to a transferee in relation not only to his pre transfer employees but also to the transferred employees, for the same reasons that I consider that Article 7(2) cannot be interpreted in that way, it is clear to me that that is not the correct interpretation of regulation 13(6). The drafter of the regulations has clearly read the Directive as providing that the transfer date is the cut off date for consultation; as the IDS commentary so graphically puts it, the provisions of regulation 15(12) put a 'spanner in the works' of the suggestion that it might extend beyond that date. I consider that he was right to do so. TUPE provides properly and appropriately for the protection of the transferring employees' contractual rights. Further, it provides, properly and appropriately, for such interests as the separate groups of employees can reasonably be said to have prior to the transfer and prior to the effecting of pre transfer changes. It provides expressly for the transferring employees' right to object to being transferred, emphasising the importance of transmitting information prior to transfer. It is information that they need at that point, to assist them in the important decision making that they require to do. There is no point in providing for the transferring employees to be entitled to consultation regarding measures envisaged by the transferee employer because their contracts of employment cannot be changed even by agreement, if the reason for the change is the transfer.[64]Looking at matters as a whole, the interpretation proposed by Mr Napier on behalf of AMICUS and TGWU would be unduly burdensome to transferee employers and potentially unworkable. It would be entirely open–ended. They would never be free of the obligation to consult whenever they envisaged measures that could be interpreted as being in connection with the transfer and might affect employees who had been transferred to them, even if the transfer had taken place years before. The obligation would be in respect of any relevant measure, however trivial. That would be quite unreasonable and it is not to be expected that a European Directive intends to impose unreasonable burdens. The comment in the draft Article appended to the European Commission's 1974 Memorandum to the effect that it is not to operate so as to prejudice the operation is of interest in that respect as is the complete absence in the Commission commentaries on the Directive of any suggestion that the obligation for which the unions here contend, exists.[65]I hesitate to turn to my own comment in the case of Sweetin to the effect that the transferee employers' obligation is to consult pre not post transfer since it was obiter and the point was not the subject of debate in that case. I am, however, reassured that my conclusion is the correct one by the fact that a similar conclusion was reached by Mummery J, as he then was, in the South Durham Health Authority case.[66]In these circumstances, I do not see that there is room for a reference to be made. The matter is clear. The obligation to consult for which AMICUS and TGWU contend is not provided for the Directive nor is it provided for by the Regulations.[67]In these circumstances, I will dismiss the appeal and in respect that the forms ET1 and responses to requests for further information appear to disclose claims other than the allegation of LLP's failure to consult post transfer, remit to the Employment Tribunal to proceed as accords.