Skip to content

In the recent case of Holt v EB Security Ltd, the Employment Appeal Tribunal (EAT) held that continuity of employment will be preserved where an employee is absent from work at one employer (due to a temporary cessation of work) and then starts different work for an associated employer.

Associated companies

Mr Holt was dismissed by the first employer but then, within 14 days, was employed by the second, which was an associated company of the first. Although the second job was entirely different from the first, after his subsequent dismissal, Mr Holt argued that his continuity of employment was preserved.

The matter came before the Employment Appeal Tribunal, which disagreed with the original tribunal and found that continuity was preserved. The EAT found that, looking back from the perspective of the new job, there had simply been a temporary cessation of work between the original job and the subsequent position, and that the claimant had been absent from work as a result of that cessation. Accordingly, the EAT found that there was no need for the second employer to have resumed the operations of the first employer, because of the fact that any work with an associated employer is sufficient to amount to and preserve continuity.

Employers operating from a group of associated companies should therefore bear this judgment in mind when employing staff who have recently been engaged by other companies in their ‘group’. What at first glance may appear to be a genuine break in continuity could, upon proper consideration, amount instead to a temporary cessation of work. Care should be taken where the total period of continuity is sufficient to grant unfair dismissal rights.

If you would like more information about the issues raised in this article or by employment law matters in general, please contact our Employment Law specialists by emailing [email protected]