Fine for failure to provide employee liability information

The sum, which represents £500 for each of the 131 employees transferring, was payable to the transferee. The case concerned a second generation contracting out of services following a retender exercise. The transferor was in severe financial difficulties and had a reasonable belief that the employees might seek to bring claims against the transferee for unpaid salary which was due at the end of the month before the transfer – hence failing to provide the required employee liability information.

(Unfortunately for the transferor, the fine imposed by the Tribunal will only compound their financial difficulties.) The Tribunal made an award that it considered was just and equitable having regard to the requirement to consider this, in the light of the loss sustained as a result of the transferor’s failure to provide the information and the limit on the ability of the transferee to mitigate its loss.

This legal update is provided for general information purposes only and should not be applied to specific circumstances without prior consultation with us.

For further details on any of the issues covered in this update please contact Gemma Ospedale, Partner in Employment on 020 7583 2222.