Employment Law Speed Read – 01/10/18
28th September, 2018
In Tabberer & Ors v Mears Ltd & Ors, the Employment Appeal Tribunal held that the variation of Mr Tabberer's employment contract following a relevant transfer, was not void under Regulation 4(4) of the Transfer of Undertaking (Protection of Employment) Regulations 2006.
Mr Tabberer was an electrician who was originally employed by Birmingham City Council. Mr Tabberer was entitled to a contractual payment called the ‘Electricians Travel Time Allowance’ (ETTA). The allowance was introduced in 1958. Its purpose was to compensate employees for the loss of a productivity bonus caused by the requirement for electricians to travel to different depots.
Mr Tabberer’s employment was subject to a number of transfers under the Transfer of Undertaking (Protection of Employment) Regulations 2006 (TUPE). On 1 April 2008, Mr Tabberer’s employment was transferred to his current employer, Mears Ltd. As working practices developed, the productivity bonus was phased out. As such, the rationale for the ETTA ceased to exist. The employer notified Mr Tabberer that he would no longer be entitled to the ETTA.
Mr Tabberer brought a claim to the Employment Tribunal (ET) arguing that the contractual variation was void under Regulation 4(4) TUPE. Regulation 4(4) states that a contractual variation shall be void if the sole or principal reason for the variation is the transfer itself or a reason connected with the transfer.
The ET found in favour of the employer and held that the principal reason for the contractual variation was not the transfer or a reason connected with the transfer. The employer imposed the contractual variation because the allowance was ‘outdated and unjustified’. Consequently, the ET held that the contractual variation was not void.
Mr Tabberer appealed to the Employment Appeal Tribunal (EAT).
Employment Appeal Tribunal
The EAT dismissed Mr Tabberer’s appeal and held that the ET was entitled to find that the variation of Mr Tabberer’s employment contract was because the allowance was outdated and could no longer be justified.
The EAT held that just because a contractual variation is imposed at the same time as a relevant transfer does not necessarily mean that the transfer is the operational reason for the contractual variation. The pivotal question to be considered is ‘what is the reason, what caused the employer to do what it did?’
The EAT attached significance to the fact that the belief that the ETTA was outdated, was a pre-existing state of affairs and had been discussed prior to the relevant transfer.
The case highlights that if a contractual variation and a relevant transfer occur simultaneously, it does not necessarily mean that the variation occurred as a result of the transfer. Consequently, a contractual variation is not automatically void if it was imposed at the same time as a relevant transfer.
Although this case may act as a useful precedent, caution should be exercised as the Tribunal uses a contextual approach when determining cases under TUPE and each case will turn on its own facts.
If you have any questions on the above and how it will affect you, please do not hesitate to get in touch with a member of our employment team.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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