Spaceright Europe Ltd -v- Bruno Baillavoine and another

First: This case has made it clear that dismissal in contemplation of a sale, even if the purchaser has not yet been identified, is automatically unfair. Under regulation 4 of TUPE 2006, the liability of the transferor to pay compensation for an automatically unfair dismissal is transferred to the transferee (the purchaser) upon completion.

Second: Under regulation 7 of TUPE 2006 the dismissal of an employee either before or after a transfer will be automatically unfair if it is for a reason connected with the transfer, unless it is for an "economic, technical or organisational reason entailing changes in the workforce" ("ETO reason"). The CA has confirmed that the ETO defence is not available where the dismissal was in contemplation of a transfer and that there is sufficient connection to a transfer even where a buyer has not yet been identified.

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