Complainant

Respondent

Parties

Simon  Legg

Ceva Logistics

Representatives

  Self-Represented

Jennifer Cashman RDJ LLP

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00066066-001

17/09/2024

This matter was heard by way of remote hearing pursuant to the Civil Law and Criminal Law (Miscellaneous Provisions) Act, 2020 and S.I. No. 359/2020 which designates the WRC as a body empowered to hold remote hearings.

I have taken the time to carefully review all the evidence both written and oral. I have noted the respective position of the parties. I am not required to provide a line for line rebuttal of the evidence and submissions that I have rejected or deemed superfluous to the main findings. I am guided by the reasoning in Faulkner v. The Minister for Industry and Commerce [1997] E.L.R. 107 where it was held “…minute analysis or reasons are not required to be given by administrative tribunals...the duty on administrative tribunals to give reasons in their decisions is not a particularly onerous one. Only broad reasons need be given…”.

No oath or affirmation was administered as there was no dispute as to the factual basis of the complaint or to the timeline within which the complaint was lodged.

The complainant submitted that the company changed ownership, and he took a complaint seeking to have the matter ruled as a transfer of undertakings.  In oral evidence, he confirmed that the change in ownership related to a share acquisition.

The respondent disputed the existence of a transfer of undertakings situation noting that the company changed ownership due to share acquisition, which it suggested was outside the definition of a Transfer of Undertakings according to the legislative basis.

The respondent sought to rely on the case of Larkin v Premier Service Station Ltd (ADJ-00053370) which highlights clearly that the Transfer Regulations do not apply to share sales in Ireland.  It was submitted that in that case the employee (complainant) claimed while she was abroad in 2024, her workplace, Premier Service Station Ltd., transferred ownership of the company/business without her knowledge or without having given any notice to her whatsoever. She stated that she only found out about the shop being closed after receiving a message from a work colleague. The message indicated that the employees at the shop were told not to come in anymore.  The employee further contended that she did not receive any written notice from the new owners.

The respondent submitted that in that case was owned by two named persons until May 2024. In May 2024, their shares in the company were purchased by another company. However, the legal entity of the business did not change. It argued that the legal employer had not changed.

The respondent submitted that the WRC found that there had been no breach of the “TUPE” Regulations as there had been no change of employer (as required under the Regulations. It noted: The European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No 131 of 2003) defines “transfer” as follows. These Regulations shall apply to any transfer of an undertaking, business, or part of an undertaking or business from one employer to another employer as a result of a legal transfer (including the assignment or forfeiture of a lease) or merger. (2) Subject to this Regulation, in these Regulations—“transfer” means the transfer of an economic entity which retains its identity; “economic entity” means an organised grouping of resources which has the objective of pursuing an economic activity whether or not that activity is for profit or whether it is central or ancillary to another economic or administrative entity. The WRC concluded: A transfer of undertakings (‘TUPE’) occurs when a business or part of a business is taken over by another employer as a result of a merger or transfer. TUPE, however, does not apply where there is a sale of shares in an employing company but there is no change of employer when the shares in the company change hands. Share transfers are not covered by the Directive as there is no change in the identity of the employer.

The respondent also relied upon the case of ICAP Management Services Ltd v Berry [2017] EWHC 1321 (QB), a UK case in which it was held that “Where the shares in a company are simply sold from one party to another, there is only a change of ownership of the employer, not an actual change of employer. In this case, ICAP plc sold its shares in an ICAP holding company to Tullett Prebon plc, so ownership of the holding company and its subsidiaries (including IMSL) transferred to Tullett Prebon. Crucially, only the shares changed hands and there was no separate purchase of assets or merger of ICAP entities with Tullett Prebon entities. The High Court therefore ruled that Mr Berry’s employer remained IMSL at all times confirming that “a simple acquisition of control of shares does not constitute a transfer within TUPE”.

As the case revolved around information of a factual nature that was not in contention, a brief hearing took place.  The complainant provided limited evidence at the hearing in regard to the timeframe of lodgement of the complaint and as to the nature of the ownership change.  Although a number of witnesses were present for the respondent, no oral evidence was provided to the hearing.  Matters were considered largely on the basis of the written submissions, with confirmation of the facts being provided by the complainant.  These were not disputed by the respondent.

The respondent cited the case of Larkin v Premier Service Station Ltd. (ADJ -00053370) which is particularly instructive in relation to the current case, and it is worth noting the findings and conclusions of the Adjudication Officer, Ms Sobanska, in full:

“The Complainant alleges that the previous owner of the business (Premier Service Station Limited) did not advise her in relation to the transfer.

The Respondent asserted that no TUPE occurred. While sale of shares took place, the Respondent entity has not changed.

The European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No 131 of 2003) defines “transfer” as follows.

3. Application

(1) These Regulations shall apply to any transfer of an undertaking, business, or part of an undertaking or business from one employer to another employer as a result of a legal transfer (including the assignment or forfeiture of a lease) or merger.

(2) Subject to this Regulation, in these Regulations—

“transfer” means the transfer of an economic entity which retains its identity;

“economic entity” means an organised grouping of resources which has the objective of pursuing an economic activity whether or not that activity is for profit or whether it is central or ancillary to another economic or administrative entity.

A transfer of undertakings (‘TUPE’) occurs when a business or part of a business is taken over by another employer as a result of a merger or transfer.

TUPE, however, does not apply where there is a sale of shares in an employing company but there is no change of employer when the shares in the company change hands. Share transfers are not covered by the Directive as there is no change in the identity of the employer (Henry v London General Transport Services Ltd. EAT/960/97).

While there may be exceptional circumstances, the key test is whether there has been a change in the legal or natural person who is responsible for carrying on the business and takes over the obligations towards the employees.

Having carefully considered the parties’ submissions and evidence, I find that in this case, while the sale of shares took place, no transfer of undertakings occurred.”

The facts of the present case are almost identical to that of Larkin v Premier Service Station Ltd. Accordingly, I am guided by the rationale and decision of the Adjudication Officer in that case.  Having considered the written and oral evidence put forward by the parties, I find that while a sale of shares took place, no transfer of undertakings occurred.

Having regard to all the written and oral evidence presented in relation to this matter, my decision is that no transfer of undertakings took place, and accordingly the complaint is not well founded.

Transfer of undertakings – share acquisition – no transfer – complaint not well founded.