www.employmentappeals.gov.uk/Public/Upload/07_0171ResfhCNCEA.doc

The EAT has tackled the famously difficult issue of the application of TUPE to a transfer out of the jurisdiction in Holis Metal Industries v Power. In this case, the ‘Swish’ track, pole and blind manufacturing arm of Newell Ltd’s business, based in Tamworth, was transferred to Holis which informed the 180 staff that the business would move to Israel. The staff were advised that if they did not wish to transfer they would be made redundant, and indeed all employees in that part of the business were dismissed shortly after the transfer. The GMB then brought claims on behalf of the staff for failure to inform and consult with the recognised union. The EAT were asked to consider whether in principle the TUPE Regulations 2006 could apply to an off shore transfer. The EAT decided that both the Acquired Rights Directive and Regulation 3 of the TUPE Regulations were precise in setting the application of the regulation to transfers of undertakings situate immediately before the transfer in the UK. It held that a purposeful approach should require that those employees should be protected even if the transfer was to be across borders outside the EU. The case was then remitted to the Employment Tribunal to decide whether in fact there had been of an economic entity which retained its identity after the transfer. This case is useful in its consideration of whether TUPE can potentially apply to an off shore transfer but the practical significance is likely to be minimal. It is likely that the business’s identity will in most cases change sufficiently to be deemed to fall outside the application of TUPE.