Meter U Ltd v Ackroyd & Ors (Transfer of Undertakings : Economic technical or organisational reason) [2012] UKEAT 0206_11_2802 (28 February 2012)

Meter U Ltd v Ackroyd & Ors (Transfer of Undertakings : Economic technical or organisational reason) [2012] UKEAT 0206_11_2802 (28 February 2012)

'Workforce' in TUPE Regulation 7(2) does not include corporate franchisees. The dismissal of employees whose roles were replaced by franchisees was for an economic and organisational reason entailing changes in the workforce and constituted redundancy. The Employment Tribunals erred in law by including franchisees in the workforce and holding the dismissals automatically unfair.

Citation
[2012] UKEAT 0206_11_2802
Parties
Appellant/respondent: Meter U Ltd; Claimants (ackroyd): Ms L Ackroyd & Others; Claimants (hardy): Mr M L Hardy & Others
Jurisdiction
United Kingdom
Judgment Date
28 February 2012
Procedural Posture
Employment Appeal / Appeal From Employment Tribunal Judgments
Outcome
Appeals allowed; findings of automatic unfair dismissal set aside; cases remitted to Employment Tribunals for further determination.
Legal Topics
Transfer of Undertakings (tupe), Redundancy, Unfair Dismissal, Franchise Arrangements, Employment Status
Employment Law Labour Law Transfer of Undertakings (tupe) Redundancy Unfair Dismissal Franchise Arrangements Employment Status

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Parties

Meter U Ltd

Appellant/respondent

Ms L Ackroyd & Others

Claimants (ackroyd)

Mr M L Hardy & Others

Claimants (hardy)

Procedural Posture

Employment Appeal / Appeal From Employment Tribunal Judgments

Legal Issues

  1. 1 Whether 'workforce' in TUPE Regulation 7(2) includes franchisees or only employees
  2. 2 Whether dismissals were for an economic, technical or organisational reason entailing changes in the workforce (ETO reason)
  3. 3 Whether the franchise arrangements were a sham

Ratio Decidendi

'Workforce' in TUPE Regulation 7(2) does not include corporate franchisees. The dismissal of employees whose roles were replaced by franchisees was for an economic and organisational reason entailing changes in the workforce and constituted redundancy. The Employment Tribunals erred in law by including franchisees in the workforce and holding the dismissals automatically unfair.

Court Disposition

Appeals allowed; findings of automatic unfair dismissal set aside; cases remitted to Employment Tribunals for further determination.

Orders

  • Ackroyd cases remitted to Tribunal to determine fairness of dismissals under ERA s.98(4).
  • Hardy cases remitted to Tribunal to determine if franchise model was a sham, and if not, to determine fairness of dismissals under ERA s.98(4).