Is the removal by an employer of an 'outdated and unjustified' contractual allowance void under TUPE when it comes after a transfer?
No, held the EAT in Tabberer v Mears Ltd, dismissing the Claimants' appeal.
The Claimants were electricians, formerly employed by Birmingham City Council, who had a historic entitlement to an 'Electricians Travel Time Allowance' (ETTA), which dated from 1958, itself replacing a productivity bonus. ETTA was held to be contractual. With changes in working practices, the Respondent gave notice to vary the Claimants' contracts to end ETTA, describing it as an 'outdated and unjustified' allowance. The Claimants argued that the variation was void under Regulation 4(4) of TUPE as connected with a transfer.
The tribunal disagreed, accepting that the Respondent's reason for ending the ETTA was not connected with a transfer, but because it was outdated. The EAT held that the tribunal was entitled to have found that the Respondent's reason was not connected with a transfer.
The EAT noted that the parties had approached the question of the reason for the variation as a question of fact rather than one of fact subject to a legal assessment. The EAT summed up the approach as 'The question to be asked is: what is the reason? What caused the employer to do what it did?'.
Thanks to Ed McFarlane of Deminos HR for preparing this case summary.