The Manchester College v Hazel UKEAT/0642/11/RN
In this case the EAT held that Miss Hazel and her colleague Mrs Huggins were automatically unfairly dismissed in breach of regulation 7 of TUPE (transfer-related dismissals).
The real reason for the dismissal was the employees’ refusal to accept harmonized contracts, and not an “ETO reason entailing changes in the workforce”.
The employees had been put at risk of redundancy as part of a post-TUPE transfer redundancy exercise, but were later told that their jobs were safe.
They were then asked to accept a significant reduction in pay and were dismissed when they refused.
The EAT held that the reason for dismissal was the employees’ refusal to accept the new terms. The imposition of new terms with a view to harmonisation does not entail a change in the workforce and therefore cannot be an ETO. It was incorrect to link their dismissal to the redundancy exercise which did involve a change in the workforce. Therefore, their dismissals were automatically unfair.
This is a very fact-specific case but it illustrates very well how an ETO reason must “entail a change in the workforce”, whether functional or numerical.
A background of changes will not give rise to an ETO reason in relation to the dismissal of a specific employee unless there is a direct link between them.