TUPE: Pre-pack dismissals are automatically unfair


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Posted on 18 Mar 2011

In OTG Limited v Barke and others, the EAT has departed from its ruling in Oakland v Wellswood (Yorkshire) Limited in respect of administrations and dismissals.

The position had been that where a company had entered into administration and there was a business transfer, the ET would consider whether the administration was with a view to liquidation. If the administration was with a view to liquidation, then any dismissals in connection with the transfer would likely be “fair”.  However, the EAT has now concluded that if administration proceedings are commenced, the administration proceedings cannot be regarded as being “bankruptcy proceedings”.  Any dismissal in connection with the transfer will be automatically unfair.   

Essentially, where an administration has commenced, even in a situation of a pre-pack administration, dismissals in connection with the transfer will be automatically unfair. 

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