E.T. Z (WR) EMPLOYMENT TRIBUNALS (SCOTLAND) Case No: 4107416/20 (A) Held on June and and August 2021 Employment Judge J M Hendry Members Ms D McDougall Mr A Atkinson Mr A Gallagher v Represented by Mr M A S Briggs, Solicitor Ponticelli UK Limited and 1 other — 2021

The claimant was employed by TEPUK and became a participant in its Share Incentive Plan after receiving the 13 July 2018 email and completing the participation documents. His employment transferred to Ponticelli UK Limited on 1 May 2020. The agreed facts recorded that his SIP membership ended on that date, the shares were transferred to him, and the respondent later paid him £1,855 in June 2020 as a one-off payment linked to the loss of the benefit, which he had asked not to be paid while he challenged the position.

The tribunal held that the claimant’s right to participate in the SIP was a right "under or in connection with" his contract of employment for the purposes of regulation 4(2)(a) of TUPE and therefore transferred to the respondent. It rejected the respondent’s reliance on the trust deed, explanatory booklet and partnership agreement wording stating that the plan did not form part of the contract of employment, and considered that the right was caught by TUPE notwithstanding the contractual drafting. In reaching that conclusion the tribunal referred to Chapman, Jefferies, Jackson and, importantly, Mitie/French, and held that the transferred entitlement was to participation in a scheme of substantive equivalence rather than a right to keep the exact pre-transfer scheme unchanged.

The tribunal also rejected the respondent’s personal bar/acquiescence argument. It found that the June 2020 payment had not been accepted by the claimant in a way that showed compromise or final settlement of his claim, noting that he had emailed to object to the payment and that there was no evidence of an agreed compromise. It further noted that there was no formal termination of the scheme on the contractual terms in the sense suggested by the respondent.

The final order was declaratory rather than monetary. The tribunal declared that following the transfer on 1 May 2020 the claimant became entitled to participate in a share incentive scheme of substantive equivalence or comparable value to the TEPUK SIP, and that his terms and conditions should reflect that obligation on the terms set out in the 2013 Explanatory Booklet.