HELD: (1) The appeal proceeded on the assumptions that, whoever succeeded, the decision did not give rise to any general tax point concerning PRP Schemes, and any tax problems for companies in the Atkins Group or their employees. The appellant company indicated that if it lost the appeal it would make net payments to the respondents (although it would make gross payments if it was necessary or appropriate). (2) The answer to the appeal turned on the particular wording of the PRP Scheme in the particular circumstances of the case. The issue was not simply one of construction, but how the PRP Scheme was to be construed and applied having regard to the TUPE transfer, the terms of TUPE (including the deeming provisions contained in Reg.5 – see Marshall v Kerr (1995) AC 148) and TUPE's purpose. The decisions of the ECJ in Knud Wendelboe & Others v L J Music ApS in liquidation (case 19/83) and H B M Abels v The Administrative Board of the Bedrijfsvereniging voor de Metaalindustrie en de Electrotechnische Industrie (Case 135/83) indicated the general purpose underlying the Acquired Rights Directive and TUPE. Morris Angel & Son Ltd v Hollande & another (1993) IRLR 168 and Whent and others v T Cartledge Ltd (1997) IRLR 153 were examples of the effect and application of TUPE in different situations but did not provide clear or decisive support to either party. (3) When the required purposive approach was taken to the construction and application of TUPE in the present case the result was that: (i) immediately before the TUPE transfer Atkins Services had a liability or duty of a type that was within Reg.5(2) of TUPE to the respondents to make a payment, or procure the making of a payment to them under the PRP Scheme as part of their pay; (ii) the respondents were employed in a part of the undertaking that was part of the undertaking of the Atkins Group at the beginning of and throughout the profit period for the PRP Scheme; and (iii) the respondents remained employed in the undertaking at a date specified in the rules of the PRP Scheme; albeit that by that date they were not employed by a company within the Atkins Group. (4) The appellant company was therefore bound to make payments to the respondents pursuant to their transferred contracts of employment and the rules of the PRP Scheme.
Appeal dismissed.
Ms Melanie Tether instructed by Kidd Rapinet (Haslemere) for the respondents.