Can there still be a TUPE transfer after a gap of five months?

The European Court (CJEU) decision in Jorge Siguenza v Ayuntamiento de Valladolid concerns the potential application of a transfer of undertaking (TUPE transfer in the UK) in a case in which there is a long gap between one undertaking ceasing its activities and another commencing. Mr Siguenza was employed as a music teacher at the Municipal Music School of Valladolid in Spain from November 1996. From 1997 to 2013 management of the school was provided by a contractor, Musicos y Escuela, on behalf of the local authority. In 2012-13, owing to a reduction in the number of pupils, the authority refused to pay the sums claimed under the contract by Musicos y Escuela, which therefore sought the termination of the contract and claimed damages. In response, in August 2013, the authority terminated the contract, alleging wrongful conduct by Musicos y Escuela because it had ceased its activities before the end of the contractual end date. In a series of judgments delivered in 2014 and 2015 the Tribunal Superior determined that the authority had breached the contract because it was committed to providing guaranteed payments irrespective of the number of students, so that failure to make those payments in full had caused the breach of contract.

In the meantime, in March 2013, Musicos y Escuela started consultations with a view to the dismissal of all its staff. Mr Siguenza and his fellow employees were dismissed on 4 April and the company was declared insolvent on 30 July.

In August 2013 the authority assigned the management of the school to In-pulso Musical and provided it with the use of the premises, instruments and equipment necessary for it to carry out its duties. In-pulso Musical commenced its management of the school in September 2013 for the 2013-14 school year and was awarded further contracts for 2014-15 and 2015-16.

Unfair dismissal claims by the former employees failed but Mr Siguenza brought a further claim before the social court. His claim was dismissed on the basis of res judicata (the matter had already been determined by the other court) and he appealed to the high court. In doing so, he contended that there had been a transfer of undertaking from Musicos y Escuela to In-pulso Musical so that his contract of employment should have been preserved. It was this aspect of his claim that was transferred to the CJEU.

Important ECJ decision opens up the possibility of valuable retrospective holiday claims

I have written in this blog on many occasions about the importance of getting it right if you are going to treat all or part of your workforce as self-employed, rather than as fully fledged workers or employees. As you may recall, the Pimlico Plumbers case earlier this year ruled in favour of the claimants, finding that they were workers rather than being “fully” self-employed and therefore entitled to holiday pay and other benefits. The issue has been a hot topic throughout 2017 with the Uber and Addison Lee cases for example showing a willingness on the part of the courts to find that there was an employment relationship where, previously, there was assumed not to be.

But what basis should be applied for calculating losses if an entitlement to retrospective holiday pay or other benefits is established. The normal cut off point for calculations is six years, since this is the time limit for claims based on breach of contract. However, the entitlement to paid holidays arises under the EU Working Time Directive and this has a statutory footing.

This issue was recently considered by the Court of Justice of the European Union (CJEU/ECJ) and judgment was delivered in the case of King v The Sash Window Workshop Limited and Dollar on 29 November. Mr King had started working for Sash Window Workshop (“the Company”) in June 1999 on a “self-employed commission only contract”. He continued to work for the Company until his retirement in 2012. He took numerous holidays during the 13 years that he worked for the Company, but was not paid for them. Following his retirement he asked to be paid all his holiday pay for the entire period of his engagement. Unsurprisingly, the Company refused.

Mr King took his claim to an employment tribunal which held that there were in effect three types of holiday claims: (i) holiday pay for 2012-13 accrued but untaken when he left, (ii) holiday pay for leave actually taken but in respect of which no payment was made and (iii) pay in lieu covering accrued but untaken leave (amounting to a further 24.15 weeks). The tribunal found that Mr King was a worker (within the meaning of the statutory definition – see the Pimlico case) and therefore ruled in his favour in respect of all three.

The Company appealed to the Employment Appeal Tribunal.

European Court of Justice gives OPINION on unpaid and untaken holidays

Does a worker’s holiday entitlement continue to accrue into successive years if they do not take their annual leave because their employer will not pay them for these holidays? The Advocate General at the European Court of Justice (ECJ) has answered ‘yes’ to this question, in a non-binding opinion. In the case of King v…

Does a ban on wearing headscarves amount to direct discrimination?

In a somewhat surprising decision, given the views expressed in some other recent cases, the Court of Justice of the European Union (CJEU) has decided that a ban on wearing headscarves at work does not (necessarily) constitute direct discrimination with reference to religion or belief. In  Achbita, Centrum voor Gelijkheid van kansen en voor racismebestrijding v…

Is it discriminatory to exclude over 35s from police recruitment?

In the UK applicants for police recruitment have to be at least 18 years old. There is no upper age limit but the normal retirement age is 60. Eligibility requirements also cover such matters as nationality, criminal record, tattoos, financial status, physical fitness, health and eyesight. In Gorka Salaberria Sorondo v Academia Vasca de Policia…

What are the likely implications of Brexit on UK Employment Law/HR practices?

Employers may not be aware that much of the current legislation in place to protect employee rights actually derives from the European Union – for example, working time regulations, rights of the employees on a business transfer (TUPE) and family leave rights to name but a few. Indeed some Politicians for the ‘Leave Campaign’ will no…