Liability following transfer

Case 2: The facts

Mr Coutinho was made redundant by Vision Information Services (VIS) when the business transferred to Rank Nemo (RN). A tribunal found that the transfer was the reason for his dismissal, and that this was unfair under TUPE. It also upheld his claim of race discrimination.

Some months after his employment ended, Coutinho asked VIS for a reference. The reference they provided was inadequate; he said this amounted to victimisation. The issue on appeal was whether, since VIS was now insolvent, RN was liable for the victimisation claim.

The ruling

The Employment Appeal Tribunal held that Coutinho could not bring his claim against RN; a failure to provide a reference by an employer who had never employed the individual could not be an act of victimisation, it said.

When a transfer takes place, the transferee (in this case, RN) takes on all the legal liabilities of the transferor (VIS). But Coutinho had not asked for a reference from VIS until after the transfer had taken place, meaning that RN was not liable.