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Industrial Tribunals Northern Ireland Decisions |
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You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> Ennis v Leslie Hogg t/a Galaxy Cabs Eddie Shaw and Paul Mawhinney ... Leslie Hogg t/a Galaxy Cabs Eddie Shaw and Paul Mawhinney ... Leslie Hogg t/a Galaxy Cabs Eddie Shaw and Paul Mawhinney ... [2013] NIIT 2369_12IT (02 December 2013) URL: http://www.bailii.org/nie/cases/NIIT/2013/2369_12IT.html Cite as: [2013] NIIT 2369_12IT |
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THE INDUSTRIAL TRIBUNALS
CASE REFS: 2369/12
2480/12
2481/12
CLAIMANTS: 1. Heather Margaret Ennis
2. Irene Price
3. Margaret Napier
RESPONDENTS: 1. Leslie Hogg t/a Galaxy Cabs
2. Eddie Shaw and Paul Mawhinney t/a Kare Kabs
DECISION
1. The contracts of employment of all three claimants transferred from the first named respondent to the second named respondent in accordance with the Transfer of Undertakings (Protection of Employment) Regulations 2006.
2. The claimants are entitled to redundancy pay and notice pay in the circumstances of the termination of their employment by the second-named respondent as follows:-
(1) Ms Ennis is awarded the sum of £1,920.00 in respect of her redundancy entitlement and the sum of £1,416.00 in respect of notice pay making a total award of £3,336.00.
(2) Miss Price is awarded the sum of £1,512.00 in respect of her redundancy entitlement and the sum of £1,296.00 in respect of notice pay making a total award of £2,808.00.
(3) Mrs Napier is awarded the sum of £2,700.00 in respect of her redundancy entitlement and the sum of £1,680.00 in respect of notice pay making a total award of £4,380.00.
Constitution of Tribunal
Chairman: Mrs A Wilson
Members: Mrs N Wright
Mr A Crawford
Appearances:
The claimants appeared in person and were unrepresented.
Mr Hogg appeared in person and was unrepresented.
Mr J Bryson appeared on behalf of Eddie Shaw and Paul Mawhinney t/a Kare Kabs.
THE ISSUES
1. The issues before the tribunal were as follows:-
(i) Was there a transfer on undertakings within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“the Regulations”) between Trevor Hogg t/a Galaxy Cabs ("Galaxy Cabs") as transferor and Eddie Shaw and Paul Mawhinney t/a Kare Kabs ("Kare Kabs") as transferee so as to transfer the contracts of employment of the claimants from the Galaxy Cabs to Kare Kabs.
(ii) Are the claimants entitled to redundancy pay and notice pay following the termination of their employment?
(iii) If the claimants are entitled to redundancy pay and notice pay what amounts are due to them under these separate headings?
THE EVIDENCE
2. The tribunal considered the following:-
(i) the claim forms, the responses and documents handed in during the course of the hearing;
(ii) a photograph of the premises from which Galaxy Cabs was operated displayed on the mobile phone of Mrs Chapman;
(iii) a text message displayed on the mobile phone of Ms Ennis, a transcript of which was produced to the tribunal;
(iv) the sworn testimony of all three claimants;
(v) the sworn testimony of Mrs Chapman and Mr Hogg;
(vi) the submissions of the parties.
FINDINGS OF FACT
3. Galaxy Cabs was a taxi firm operating in Bangor, Co Down. The claimants were employed by Galaxy Cabs. Their employment details for the purposes of redundancy pay and notice pay are as follows:-
(1) Ms Ennis whose date of birth is 1 August 1963 commenced employment with Galaxy Cabs on the 10 October 2000. She worked 20 hours per week and earned £120.00 gross pay per week and received £118.00 net weekly pay. She had 12 years continuous employment when her employment was terminated on 16 September 2012.
(2) Miss Price whose date of birth is 16 March 1972 commenced employment with the Galaxy Cabs on 20 July 1998. She worked 18 hours per week and received £108 net pay per week. She had 14 years continuous service when her employment was terminated on 11 September 2012.
(3) Mrs Napier whose date of birth is 26 February 1952 commenced employment with Galaxy Cabs on 1 August 2000. She worked 25 hours per week and earned £150 gross pay per week and received £140.00 net pay. She had 12 years continuous service when her employment was terminated on 13 September 2012.
All three claimants were employed by Galaxy Cabs as part time telephone operators. Their duties included taking taxi bookings and dispatching drivers to fill these bookings.
4. Galaxy Cabs ceased to operate on 12 September 2012 due to financial difficulties. Mr Hogg was unable to continue trading due to unmanageable financial pressure and the tribunal is satisfied that this was a source of some considerable upset to him.
5. Mrs Napier was working at Galaxy Cabs on 12 September 2012 and her shift was due to finish at 6.00 pm. On or about 5.40 pm Mr Hogg accompanied by four representatives of Kare Kabs called to the office of Galaxy Cabs and Mrs Napier was informed that the business of Galaxy Cabs was either being taken over or being sold to Kare Kabs. It is her evidence that she cannot recall the exact words used. It is disputed that words to this effect were ever spoken to Mrs Napier and in these circumstances the tribunal is surprised not to hear from any one of the Kare Kabs representatives that were present on that occasion. It is not clear to the tribunal whether Mrs Chapman was present. In any event Mrs Chapman did not give evidence relative to this point or as to what transpired on 12 September. It is Mr Hogg’s evidence that he cannot recall what was said at the time. In all these circumstances the tribunal accepts the evidence of Mrs Napier.
6. The Galaxy Cab phones were then diverted to Kare Kabs and Mrs Napier was taken to the offices of Kare Kabs which was situated a short distance away. She brought with her a box containing details of "standing bookings" i.e. pre booked taxis together with diaries containing booking details. It is common case that the business accounts i.e. corporate clients of Galaxy Cabs did not transfer to Kare Kabs.
7. When Mrs Napier arrived at the offices of Kare Kabs she went through the standing bookings with members of Kare Kabs staff and transferred details of those bookings onto their computer system.
8. Mrs Napier recalls that whilst she was there the phones were being answered with the greeting "Galaxy /Kare Kabs". She was asked to speak to some Galaxy customers who queried the recited title and she did so explaining that Galaxy Cabs had been taken over by Kare Kabs and she assured the customers of continued good "if not better" service. The tribunal heard no evidence in contradiction of this version of events. In all these circumstances the tribunal accept Mrs Napier’s version of events as they unfolded on 12 September.
9. Mrs Napier worked at the offices of Kare Kabs until in or around 11.00 pm on the night of 12 September 2012 and she was asked to work the following day from 8.00 am until 1.00 pm. These facts do not seem to be in contention. Mrs Napier does not recall who asked her to work these hours but the tribunal is satisfied that she was asked to do so by a member of Kare Kabs staff.
10. A taxi was sent to collect Mrs Napier for work the following day and she worked the arranged hours. There is no evidence to suggest that her duties at Kare Kabs differed in any respect from her duties at Galaxy Cabs. When leaving work she enquired as to what shifts she would be required to work and as to her hourly rate of pay. It is her evidence that she was informed by Mrs Chapman that those matters would be discussed at a meeting and that she (Mrs Chapman) would be in touch. It is Mrs Napier’s evidence that Mrs Chapman never got in touch and did not return her phone calls.
11. It is Mrs Chapman’s evidence that following Mrs Napier’s second shift that she (Mrs Chapman) said she would contact her (Mrs Napier) which she proceeded to do. It is her evidence also that her efforts to contact Mrs Napier were unsuccessful.
12. The tribunal is satisfied that Mrs Chapman told Mrs Napier that she would be in touch. The evidence on this point is not disputed. It is Mrs Napier’s evidence that Mrs Chapman did not get in touch whereas Mrs Chapman says that her efforts to get in touch were unsuccessful. The tribunal prefers the evidence of Mrs Napier relative to this point. Mrs Napier had worked for 12 years. She was clearly interested in continuing to work and needed to do so for financial reasons. In these circumstances it is highly unlikely that she would have failed to return any calls to Mrs Chapman or to respond to any messages received from Mrs Chapman.
13. In all the above circumstances the tribunal is satisfied that Mrs Napier’s employment was effectively terminated on 13 September 2012 without notice.
14. Mrs Chapman denies that Mrs Napier ever worked for Kare Kabs. The tribunal does not accept this to be the case and find that she worked for Kare Kabs on the night of 12th and the morning of 13 September 2012. During those periods she worked at the offices of Kare Kabs using their systems in the course of their business. When she sought clarification from Mrs Chapman relative to her pay and her hours of work Mrs Chapman said she would be in touch.
15. It is Kare Kabs case that the contracts of employment of the employees of Galaxy Cabs did not transfer to them. There is an inconsistency between their cases in this regard and the fact that Mrs Chapman asked Mrs Napier to attend for work on 13 September and promised to be in touch thereafter relative to shifts and pay. The tribunal regards this as an indicator that Mrs Napier’s contract of employment did transfer.
16. Ms Ennis was due to start work on 12 September at 6.00 pm. She received a call at 5.45 to say that Galaxy Cabs had been taken over by Kare Kabs and she was picked up for work by a Kare Kabs representative named Adrian Magee. It is unclear to the tribunal as to whether Mr Magee was a Kare Kabs driver or a manager. In either event nothing much turns on this. She was taken to the offices of Kare Kabs. She worked her shift at the offices of Kare Kabs using their systems in the course of their business and was asked by Kare Kabs to work again on Thursday, 13th and Sunday, 16 September. There is no evidence to suggest that her duties at Kare Kabs differed in any material respect from her duties at Galaxy Cabs. She was asked when answering the phones to greet customers by saying “Good evening Galaxy/Kare Kabs”. She was provided with Kare Kabs documentation (which she produced to the tribunal) explaining the codes to be used when taking bookings, classifying jobs, tracking drivers etc.
17. At the end of her shift on 12 September Ms Ennis was taken home by Mr Hogg. It is her evidence that Mr Hogg told her that he was in financial difficulty and had to give over his business to Kare Kabs. It is agreed that Mr Hogg left Ms Ennis home and it is not disputed that he was in financial difficulty. However it is disputed that he indicated that the business had been given over to Kare Kabs. Mr Hogg’s evidence in general was limited. He answered questions in the negative or affirmative but provided no detail or elaboration on any points of evidence. On many significant points he indicated that he could not remember what transpired. The tribunal accepts that this was a very difficult time for Mr Hogg and that the events in contention were distressing for him and occurred some 13 months ago. However the tribunal struggle to accept that he cannot recall any events of significance and in these circumstances the tribunal accepts the evidence of Ms Ennis relative to their conversation.
18. Ms Ennis gave evidence regarding a conversation she had with Adrian Magee (paragraph 16 refers). Mr Bryson objected to her evidence in this regard on the grounds of hearsay. The tribunal placed no weight on her evidence relative to this conversation.
19. The tribunal considered a text message exchange between Ms Ennis and Mrs Chapman. Ms Ennis was asked by Mrs Chapman to work on Friday, 21 September from 6.00 pm to 3.00 am. She was unable to work those hours because of childcare commitments. Mrs Chapman indicated that she would be in touch relative to shifts later in the week. This is inconsistent with her case that the claimant’s contracts of employment did not transfer. Ms Ennis confirmed that she needed to work 20 hours at £6.00 an hour as had been her terms and conditions with Galaxy Cabs.
20. Mrs Chapman contacted Ms Ennis later on 20 September to indicate that there were no evening shifts available and that the rate of pay was £5.50 an hour. If as is being argued that Kare Kabs were not taking over the employees of Galaxy Cabs the tribunal would have expected Mrs Chapman to explain this to Ms Ennis rather than providing her with work initially and offering her work subsequently albeit on different terms and conditions. The tribunal regards this as an indicator that Ms Ennis’ contract of employment did transfer.
21. It is Mrs Chapman’s case that Ms Ennis never worked for Kare Kabs other than on a trial basis which proved to be unsuccessful. The tribunal does not accept Mrs Chapman’s evidence in this regard. There is no mention of a trial period in the text message exchange. There is no mention of it relative to the other claimants and there is no mention of it in the response entered by Kare Kabs. Further the tribunal is satisfied that Mrs Chapman proved to be an unreliable witness relative to her evidence that Mrs Napier contacted her in search of employment when it has transpired that this was clearly not the case. In these circumstances the tribunal accept Ms Ennis’ version of events.
22. Ms Ennis’ employment was terminated on 16 September 2012.
23. Mrs Price was due to work on 13 September 2012. She received a message relayed by Ms Ennis to her (Mrs Price’s) father to the effect that Galaxy Cabs had been taken over by Kare Kabs. She had previously been told by Mr Hogg that the business would be closing but was surprised that it had closed so soon. She had no further contact with either respondent.
24. The tribunal considered a copy agreement between Kare Kabs and Galaxy Cabs signed on 12 September 2012. The agreement was signed by Eddie Shaw and Paul Mawhinney on behalf of Kare Kabs and by Leslie Hogg on behalf of Galaxy Cabs. All signatures were witnessed by Mrs Chapman. The document produced recorded an agreement which was for the purchase of the telephone numbers of Galaxy Cabs and excluded all debts and liabilities relative to the business.
25. In circumstances where Kare Kabs have been aware since they were notified on or about 30 July 2013 that they had been joined as a party to these proceedings and have since that time been aware of an argument arising as to whether there was a transfer of undertakings between Galaxy Cabs and themselves the tribunal would have expected either Mr Shaw or Mr Mawhinney, or both, to have attended for the purposes of giving evidence as to what exactly was agreed relative to the business. They are clearly best placed to give evidence in this regard and in particular relative to the agreement between the parties. The tribunal regards it as significant that they did not give evidence.
26. The tribunal considered the evidence of Mrs Napier to the effect that a Kare Kabs free phone was installed at the former business premises of Galaxy Cabs and was available there for some months following 12 September 2012. Evidence was also presented that signage was placed at the premises advertising Kare Kabs and remained there for a period of months. Mrs Napier’s evidence is corroborated by Ms Ennis and evidence on both these counts is vehemently denied by Mrs Chapman. There is no corroboration of Mrs Chapman’s evidence. When asked about the free phone she stated that there was no such phone “to the best of my knowledge”. This indicates that such a facility may have been installed without her knowledge.
27. The tribunal considered a photograph displayed on Mrs Chapman’s mobile phone showing the Galaxy premises devoid of advertising signage. The tribunal places no weight on this photograph. It is on Mrs Chapman’s own admission a photograph of a photograph and there is no reliable evidence before the tribunal as to when the original photograph was taken.
28. The tribunal prefers the evidence of Mrs Napier as corroborated by Ms Ennis on these points and is satisfied that on the balance of probabilities that a Kare Kabs free phone was installed and their advertising was placed at the former Galaxy business premises. The tribunal regards it as highly unlikely that Mrs Napier and Ms Ennis would have fabricated this evidence. Their evidence in other material respects has been accepted by the tribunal as reliable.
29. The tribunal regards Mrs Chapman as a less reliable witness. By way of example she gave evidence that as manageress of Kare Kabs she was aware of what was going on and was confident that she would have been aware of any purchase by Kare Kabs of Galaxy Cabs. However it was also her evidence that as manageress that she had no knowledge of pay rates and that pay details were of no interest to her. She gave evidence to the effect that she knew nothing of Galaxy Cabs work because it would have been impossible to know what work was going through the business. Her evidence relative to the free phone and advertising leaves scope for doubt.
30. If as appears to be the case that Mrs Chapman was not best placed to give reliable evidence relative to these important matters the tribunal would have expected to hear from either Eddie Shaw or Paul Mawhinney who were as owners of the business undoubtedly well placed to give reliable evidence.
THE LAW
31. The Transfer of Undertakings (Protection of Employment) Regulations 2006 (”the Regulations”) apply to “relevant transfers”. The effect of the Regulations is to transfer the employment contract of any person employed by the transferor immediately before the relevant transfer to the transferee subject to their existing terms and conditions of employment.
32. A relevant transfer for the purposes of the Regulations is a transfer of an undertaking, business or part of an undertaking or business to another person where there is a transfer of an economic entity which retains its identity.
33. An “economic entity” means an organized grouping of resources which has the objective of pursuing an economic activity, whether or not that activity is central or ancillary.
34. The tribunal considered the guidance provided by case law so as to determine whether there was a relevant transfer between Galaxy Cabs and Kare Kabs in all the circumstances of this case. In essence it is necessary to determine whether what has been sold is an economic entity which is still in existence. This will be apparent from the fact that its operation is actually being continued or has been taken over by the new employer, with the same economic or similar activity (Spijkers v Gebroeders Benedik Abattoir CV: 24\85 [1986] 2 CMLR 296).
35. In this context the tribunal must determine what was sold by Galaxy Cabs to Kare Kabs and it does so in reliance on the evidence before it including the copy sale agreement produced to the tribunal. The tribunal would have found evidence from one of the signatories to this agreement of assistance in determining the issues.
36. The tribunal considered the case of Cheesman v R Brewer Contracts Ltd [2001] IRLR 14 and considered and applied the following guiding principles:-
''(i) … the decisive criteria for establishing the existence of a transfer is whether the entity in question retains its identity, as indicated … by the fact that its operation is actually continued or resumed; …
(ii) in considering whether the conditions for … a transfer are met, it is necessary to consider all the factors characterising the transaction in question, but each as a single factor and none is to be considered in isolation;
(iii) amongst the matters … for consideration, are the type of undertaking, whether or not its tangible assets are transferred, the value of its intangible assets at the time of transfer, whether or not the majority of its employees are taken over by the new company, whether or not its customers are transferred, the degree of similarity between the activities carried on before and after the transfer, and the period, if any, in which they are suspended;
(iv) account has to be taken … of the type of undertaking or business in issue, and the degree of importance to be attached to the several criteria will necessarily vary according to the activity carried on;
(v) where an economic entity is able to function without any significant tangible or intangible assets, the maintenance of its identity following the transaction … cannot logically depend on the transfer of such assets;
(vi) even where the assets are owned and are required to run the undertaking, the fact that they do not pass does not preclude a transfer; …
(vii) the absence of any contractual link between the transferor and transferee may be evidence that there has been no relevant transfer, but it is certainly not conclusive as there is no need for any direct contractual relationship; …
(x) when no employees are transferred, the reasons why that are the case can be relevant as to whether or not there was a transfer.''
37. The tribunal is satisfied that the contract produced to the tribunal is not determinative of what transferred between Galaxy Cabs and Kare Kabs based on the evidence as outlined above.
38. From the evening of 12 September onwards, Kare Kabs relied upon the phone numbers bought by them from Galaxy Cabs to attract business and to continue the business previously carried out by Galaxy Cabs relative to private customers. The tribunal is also satisfied on the evidence of Mrs Napier and Ms Ennis both of whom have considerable experience of the taxi industry that the telephone numbers of a taxi business constitute its business i.e. the telephone numbers are its most important asset and the telephone numbers of Galaxy Cabs were particularly valuable as they were easy to remember.
39. The tribunal is satisfied that after 12 September 2012 the business retained its identity as a taxi business and initially at least retained its title. In this regard the tribunal rely on the evidence of Mrs Napier and Ms Ennis to the effect that phones were answered with the greeting “Galaxy/Kare Kabs”.
40. The telephone numbers of Galaxy Cabs transferred. This is not in contention. Standing bookings transferred. This is evidenced by Mrs Napier who was required to assist in the transfer of standing bookings onto the computer system of Kare Kabs.
The tribunal is satisfied that with the telephone numbers and the standing bookings the private (as opposed to corporate) customers of Galaxy Cabs transferred.
41. The majority of employees (being the claimants) transferred.
42. The tribunal is satisfied that occupancy of the premises previously occupied by Galaxy transferred in that it was used by Kare Kabs to accommodate a Kare Kabs free phone and to display advertising on behalf of Kare Kabs.
43. The tribunal heard evidence to the effect that all drivers were self employed and the tribunal accepts this to be the case. However the tribunal also heard evidence from Ms Ennis to the effect that on the evening of 12 September Mr Hogg was busy in the office of Kare Kabs getting drivers radios changed over. Her evidence in this regard was not challenged. Based on this evidence the tribunal is satisfied that at least some of the self employed drivers of Galaxy Cabs became self employed drivers for Kare Kabs after 12 September 2012.
44. Taking the above considerations into account the tribunal is satisfied that there was a transfer on undertakings within the meaning of the Regulations between Galaxy Cabs and Kare Kabs. It follows that the contracts of employment of all three claimants transferred.
45. Mrs Price never worked for Kare Kabs. Nonetheless in reliance on regulations 4 and 7 the tribunal is satisfied that her employment contract transferred to Kare Kabs in accordance with the provisions of the Regulations.
46. The tribunal is satisfied that all three claimants were dismissed without notice in circumstances where they were entitled to notice in accordance with Article 118 of the Employment Rights (Northern Ireland) Order 1996.
47. The tribunal is satisfied on the balance of probabilities that the requirement for employees to carry out their particular work diminished following the transfer to Kare Kabs. It is clear from the evidence that shifts were not made available to the claimants following that transfer and in these circumstances the tribunal accepts their arguments that they were made redundant. They do not claim unfair dismissal.
48. Part XII of the Employment Rights (Northern Ireland) Order 1996 deals with entitlement to statutory redundancy payments and Article 197 provides the method of calculation applicable to a redundancy payment.
49. Article 118 of the deals with entitlement to notice pay.
50. In accordance with the above provisions the tribunal calculated the claimant’s entitlements as follows:-
(1) Ms Ennis is awarded the sum of £1,920.00 in respect of her redundancy entitlement and the sum of £1,416.00 in respect of notice pay making a total award of £3,336.00.
(2) Miss Price is awarded the sum of £1,512.00 in respect of her redundancy entitlement and the sum of £1,296.00 in respect of notice pay making a total award of £2,808.00.
(3) Mrs Napier is awarded the sum of £2,700.00 in respect of her redundancy entitlement and the sum of £1,680.00 in respect of notice pay making a total award of £4,380.00.
51. This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.
Chairman
Date and place of hearing: 4 November 2013, Belfast.
Date decision recorded in register and issued to parties:
