Mr Brian Mellor Mrs Susan Mellor v Lunar Automotive Limited (in compulsory liquidation) — 2021

The tribunal found that Mrs Mellor was not an employee of Lunar Caravans Ltd before the TUPE transfer and therefore did not transfer to the respondent. Although she had carried out some limited tasks for Mr Mellor and had been paid through PAYE, the tribunal found insufficient control, mutuality of obligation, and other features of an employment relationship. Her complaints against the respondent were therefore dismissed.

For Mr Mellor, the tribunal found that his salary at transfer was £681 per month. His unilateral instruction shortly before administration to restore a higher salary did not validly vary his contractual entitlement because no board decision had been made, and the company was close to insolvency. The respondent's non-payment of salary after August 2019 was therefore treated as an excepted deduction made to reimburse overpaid wages, so the unauthorised deductions and holiday pay complaints were not well founded.

The tribunal found that the respondent breached Mr Mellor's contract by failing to reimburse car petrol expenses of £1,833.47. It also found that the failure to pay those expenses, together with delay in dealing with his grievance and failure to provide a grievance outcome, amounted to a repudiatory breach of the implied term of mutual trust and confidence. Those matters were an effective cause of his resignation, and the respondent had not shown a potentially fair reason, so his constructive unfair dismissal complaint was well founded.

The respondent's employer contract claim against Mr Mellor failed because the tribunal was not satisfied that he had acted deceitfully rather than mistakenly in relation to the August payment. The claim against Mrs Mellor was dismissed because she was not an employee and, in any event, the respondent accepted there was no evidence supporting the alleged breach.