Mr B Colbourne v Environmental Control Coatings Limited and 1 other — 2023

This reserved judgment, following a two-day preliminary hearing before Employment Judge Cuthbert sitting alone in Bristol (by video) on 15 and 16 May 2023, addressed only the TUPE issues between the two respondents. The tribunal had to decide whether there was a transfer of a business or undertaking from the first respondent (Environmental Control Coatings Limited, 'ECC') to the second respondent (Lyte Coatings Limited, 'Lyte') within the meaning of Regulation 3(1)(a) TUPE on 26 July 2021, 1 December 2021, or by a series of transactions.

Examining the asserted business entity, the tribunal found no positive evidence that customers, contracts, employees, intellectual property (the PCO formula was known only to the claimant), premises, products, equipment, stock or goodwill had transferred from ECC to Lyte. The only commonality was that three directors of ECC were also directors of Lyte, together with a basic overlap in SIC codes. The tribunal accepted the respondents' evidence that Lyte was a vehicle to take advantage of a future potential opportunity that had not yet arisen, and found no continuation by Lyte of ECC's business activities. The remaining TUPE sub-issues (timing, employment immediately before transfer, assignment to an organised grouping) accordingly fell away or were academic.

The tribunal held that the claimant's employment did not transfer from the first to the second respondent under TUPE, and that the claimant's claims against the second respondent therefore fail and are dismissed in full. The judgment records that further directions will follow in respect of the claimant's remaining claims against the first respondent, which is in the process of being wound up via a CVL.