Post TUPE appeals against dismissal

The Employment Appeal Tribunal recently considered who should hear an employee's appeal against dismissal when the dismissal occurred immediately prior to a TUPE transfer. Simon Lambert reports.

In Salmon v (1) Castlebeck Care (Teesdale) Ltd (In Administration) (2) Danshell Healthcare Ltd and others UKEAT/0304/14 the employee, Mrs Salmon, was employed by Castlebeck and was dismissed for gross misconduct. She submitted an appeal, as she was contractually entitled to do under her disciplinary policy. Before the appeal could be heard the business was sold to Danshell. Had she still been employed at this time, Mrs Salmon's employment would have transferred to Danshell under TUPE.

The employee's appeal was heard by Castlebeck's HR Director, who was now employed by Danshell having also transferred. The dismissal was found to be 'unsafe', although no decision as to reinstatement was taken. The employee was not informed of this outcome. The employee brought claims for unfair dismissal against both Castlebeck and Danshell.

An employment tribunal initially dismissed the claim against Danshell reasoning that because the employee had been dismissed pre-transfer and not reinstated, she did not transfer and had never been employed by them. A crucial part of their decision was that the decision in relation to the appeal, which might have reinstated her, had not been communicated to the employee. Ms Salmon appealed to the EAT who overturned the decision.

The EAT found:

• that if the appeal was upheld, the dismissal vanished and it was as if it had never happened;
• in this case the Tribunal had been wrong to find that there had not been reinstatement in circumstances where the dismissal was found to be "unsafe"; and
• the fact that the outcome of the appeal had not been communicated was not relevant.

Therefore, the employee was employed at the date of the transfer, did transfer to Danshell and, as a result of Danshell's conduct, had been unfairly dismissed by them.

What this means for employers

The case is interesting because it looked at the effect of TUPE on the appeal process finding that a dismissal vanished as the appeal was upheld, even if not communicated to the employee. This case also highlights the importance of due diligence before a TUPE transfer to identify these types of potential issue and the importance of securing appropriate warranties and indemnities. Only if this is done properly will transferees be able to avoid the scenario highlighted in this case. If proper due diligence is overlooked you may end up with an employee you were not expecting, and the costs of their salary from the date of transfer to the date of reinstatement; or worse you may bear liability for claims of unfair dismissal.

Simon Lambert is a partner at DAC Beachcroft. He can be contacted on 0117 918 2085 or This email address is being protected from spambots. You need JavaScript enabled to view it..