Pending appeal does not change TUPE status of employee

The EAT has recently explored what happens when an appeal against a non TUPE-related dismissal is outstanding at the date of the relevant transfer. The following points emerge from Bangura v Southern Cross Healthcare.

• Responsibility for dealing with any outstanding appeal remains with the transferor.  The transferee has no obligation to hear or determine the appeal from the dismissed employee.
• If the appeal is unsuccessful, the transferee does not inherit any liabilities relating to the employee, including those relating to any subsequent claim of unfair dismissal.  Any claims relating to the dismissed employee’s employment would be between the dismissed employee and the transferor. 
• If, however, the appeal is successful and the dismissed employee is reinstated, the dismissed employee should be treated as if their employment had transferred to the transferee (ie he/she becomes the transferee’s employee).  The dismissed employee would also be entitled to full pay in the period between the date of their dismissal and the date of reinstatement. 

While this decision is logical and follows previous case law, transferees will still find it disconcerting that their obligations in these circumstances rest entirely upon the outcome of an appeal process over which they are unlikely to have any control.  This reinforces the importance of transferees making prudent enquiries prior to a TUPE transfer about the workforce they will be inheriting. 

This case involved the pre-transfer dismissal of an employee for a reason that did not relate to the transfer.  If the reason for the dismissal prior to the transfer date had related to the transfer itself, or a reason connected to it which was not an ETO reason, all liabilities relating to that employee’s employment would have transferred to the transferee, including any resulting claim of unfair dismissal, regardless of the outcome of any appeal.