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(1) Walsall MBC (2) Housing 21 Ltd v. (1) DM Birch & Ors (2) Sodexo Health Care Services Ltd (3) Pin


Employment Appeal Tribunal

The first appellant transferor local authority and the second appellant transferee (H) appealed against an employment tribunal decision to grant permission to the respondent group of 103 individuals (B) to amend their equal pay claims against the local authority to join H as a respondent. B had been employed by the local authority. Following a transfer of their employment to H under the Transfer of Undertakings (Protection of Employment) Regulations 2006, B and other employees began equal pay claims. B's claims named the local authority as the only respondent whilst the claims of the other employees named both the local authority and H as respondents. B applied for the amendment having realised that, because of reg.4(2) of the 2006 Regulations, their claims had to be brought against H as transferee, even if the local authority had been in breach of its equal pay duties prior to the transfer. The application was made outside the nine-month time limit prescribed by the combined effect of the Equal Pay Act 1970 s.2ZA(3) and the Employment Act 2002 (Dispute Resolution) Regulations 2004 reg.15 and confirmed by Sodexo Ltd v Gutridge (2009) EWCA Civ 729, (2009) ICR 1486. H contended that the judge had erred in exercising her discretion to grant the amendment because she had failed to consider that the Act imposed immutable limitation periods to equal pay claims; she should not have granted an amendment that circumvented Sodexo; and she should have weighed in H's favour the fact that the limitation period had expired.
HELD: Although the expiry of the limitation period was always an important consideration before the joinder of a new party, it was not accepted that equal pay claims were in a special category because they were subject to immutable time limits, whether as to the commencement of the claim or as to the period over which arrears could be claimed. Nor was it a special consideration that the limitation period arose by virtue of the Court of Appeal decision in Sodexo; that was a neutral consideration, Sodexo considered. The judge had clearly taken the limitation point into consideration and had given considerable weight to the issue. She had stated that H would face 103 additional claims, that allowing the amendment would enable B to circumvent the problem they had faced in claiming liability for damages for pre-transfer breaches, and that B should have seen the problem earlier. The judge had had in mind the fact that the party relying on the statutory bar already had to deal with similar claims. When assessing the balance of hardship the judge had been bound to consider B's potential hardship of being unable to bring a claim for pre-transfer loss by other means, but that did not mean that she had failed to consider the fact that H would lose the benefit of an accrued limitation period. H would inevitably have had to defend claims, but the judge had recognised that if H was unsuccessful in defending those claims it would suffer hardship and prejudice. She had applied correct principles of law, taken into account what was relevant and reached a permissible conclusion, Selkent Bus Co Ltd v Moore (1996) ICR 836 EAT applied (see paras 37-41 of judgment).
Appeal dismissed

LTL 1/6/2011

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