More?

As always it is only in a downturn that you actually find yourself looking through the Insolvency Act 1986. In my particular case the reason being was to double check what is counted as a preferred debt for employees. If you interested you will find all the information set out in Schedule 6 Category 5 Debts paragraphs 9 – 12. What is worth noting is that there is an upper limit for preferential employment debts of £ 800 (see Insolvency Proceedings (Monetary Limits) Order 1986/1996).

My instructing solicitor asked me, does this £ 800 include holiday pay? My initial reaction was of course however on closer reading of paragraph 10 it became clear that the limit found on paragraphs 9 & 12 was not to be found in paragraphs 10 & 11. This is somewhat puzzling as the books and guidance appear to take it as read that the limit applies to the totality of the employment debt.

In my particular case there was a sizeable sum outstanding in relation to holiday pay which incidentally does not appear to be defined or limited to a week’s pay or statutory entitlement as with claims to the Insolvency Service. It seems to me that the insolvency practitioner in this particular case is going to get a nasty surprise on Monday morning when he sees the size of the claim in respect of holiday pay. Mind you I do not think the administrator will take this lying down so expect a further chapter on this later this year.

You might also be interested to know a failure to pay a protective award made under TULRA S 188 & 189 can be a provable debt in an insolvency situation (see Haine & another v Day [2008] IRLR 642).

Peter D

Listing?

I have been caught up in another listing issue this time closer to home in Reading.

In this particular case the Respondent had requested a PHR to deal with the merits of what was on the papers a weak claim. This application was refused and then without recourse to the parties the matter was simply listed for two days with standard directions. This was on 16th April 2009.

Those instructing me asked for a postponement and gave dates to avoid. The Claimant did not bother to reply to the application. The Tribunal took the best part of 3 weeks to deal with the application; by which time the trial date was about a week away. The postponement was denied. Those instructing me had to make a further urgent application and the case was eventually vacated and a PHR listed.

As I understand the situation the listing of a matter is important for Tribunals statistics so clearly the earlier the listing the better the statistics. I can accept this but, and it is a big but, this is meant to be a service for the litigants. When a case is listed without recourse to either party’s availability, it should be the Tribunals practice to vacate the dates if asked to do so long as alternative dates are provided. It should be enough for a party to write in and say the dates are not convenient so long as the other party is either in agreement or is silent. This is what a service is about.

More importantly it should not take the Tribunal 3 weeks to tell you that your application for a postponement has been rejected. The idea that a simple application for a postponement should take more than a couple of working days to deal with is inexplicable.

I make a simple heartfelt plea from a Tribunal user: Please remember that at the end of the day the people using the Tribunal are your customers, please treat them as such.

Peter D

Complete Control.....

I have recently been advising a client in relation to a TUPE+ transfer. It was accepted that TUPE applied and that this meant the terms and conditions of the employees had to be maintained. The employees were transferring over from the public sector and part of their terms and conditions made reference to collective agreements negotiated from time to time.

Now I had thought that after Werhof v Freeway Traffic Systems GmbH and Co KG [2006] IRLR 400 any collective agreements entered into after the transfer that the transferee was not a party to would not bind the transferee. In layman’s terms you get the knowns not the unknowns. All very sensible and a good for employee/employer relations and freedom of association.

Then along comes Alemo-Herron and ors v Parkwood Leisure Ltd. [2009] IRLR 322. This case involved a TUPE transfer from public to private sector with the transferring employees having the ‘collective agreement term as negotiated from time to time’ clause in their contracts. The problem is that the private sector transferee would not be a party to any future collective agreements. The Tribunal followed Werhof adopting a practical and European approach to the decision.

The EAT allowed the appeal based on the UK regulations rather than the EC directive. The EAT decided that the case turned on the wording of the contract but also on the fact that collective pay bargaining UK style was different from that used on the continent. The EAT saw no problem with a clause that entitled the employee to have his wages set by some external benchmark arrived at by collective bargaining. The EAT accepted that so long as the NJC was in existence then the pay levels set by the NJC would apply even though the transferee had not and more importantly could not take part in the negotiation.

This will have far reaching implications for private sector bidding for public sector work as this clause is commonly found in local authority contracts of employment. This decision effectively takes negotiations in relation to important terms as to pay and conditions outside of the control of the new employer. No wonder leave to appeal has been granted!

Peter D