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Media Releases
2009

22 January
2009

Shepherd and Wedderburn tastes success in landmark EAT case

Shepherd and Wedderburn acted for City Building (Glasgow) LLP, one of Scotland’s largest construction companies, in a successful appeal to the Employment Appeal Tribunal (EAT).

Leading UK law firm Shepherd and Wedderburn acted for City Building (Glasgow) LLP, one of Scotland’s largest construction companies, in a successful appeal to the Employment Appeal Tribunal (EAT).

The landmark case, which was brought against City Building (Glasgow) LLP and Glasgow City Council by three unions on behalf of over 1,500 employees, concerned an alleged failure to inform and consult employees under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).

TUPE is designed to protect employees when a business transfer takes place; this can include the sale or purchase of a business or the outsourcing of a function or activity.

The case looked at whether City Building (Glasgow) LLP, to which Glasgow City Council outsourced its building services function, was required to consult with union representatives of the transferred employees from the Council after the transfer had taken place in relation to any transfer-related measures they may have envisaged taking in relation to them.

Judge Lady Smith, ruling in City Building's favour, held that transferee employers were under no obligation to do so.

Lesley Murphy of the employment division at Shepherd and Wedderburn led the team. She said: “We are pleased to have delivered such a positive result for City Building. This was a previously untested point of law and, if the EAT had not ruled in City Building’s favour, there was a concern that the consequences for all UK employers involved in future transfers could have been far-reaching. Many such transfers might have been stifled or even halted altogether.

“If the unions' propositions had been accepted, there would be a requirement to consult over changes that needed to be in place on day one after the staff handover. These might include, for example, any relocation of the transferring employees to a new site. As you can't meaningfully consult after the fact, changes like these, which may in practice be necessary to achieve the transfer, would be stalled. With the market in its current state, any further obstacles to business deals could have been a significant blow."


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