This review looks at the effect of decisions in recent employment law cases.TRANSFER OF UNDERTAKINGSThe broad scope of the Acquired Rights Directive, and of the Transfer of Undertakings (Protection of Employment) Regulations 1981 which derive from it, is becoming ever more apparent.In Christel Schmidt v Spar-und Leihkasse der Fr-heren -mter Bordesholm, Kiel und Cronshagen [1994] IRLR 302, an employee worked at a bank branch office as a cleaner.

When the branch was being refurbished, the bank decided to ask the contractor who was already responsible for cleaning most of the bank's other branches to take over responsibility for the branch.

The contractor offered to employ the cleaner for a monthly wage higher than that which she had previously received, but she rejected the offer as she calculated that her hourly rate would in fact be less as a result of an increase in the surface area to be cleaned.The European Court of Justice decided that the fact that an activity transferred was, for the transferor, merely an ancillary activity and that the transfer concerned only a single employee and did not involve a transfer of any tangible assets did not have the effect of excluding that activity from the scope of the Directive.That decision was taken into account by the Court of Appeal in Dines v Initial Health Care Services Ltd and Pall Mall Services Ltd [1994] IRLR 336.

Taking a different view from the Employment Appeals Tribunal (EAT), the Court of Appeal noted that European cases demonstrate that the fact that another company takes over provision of certain services as a result of competitive tendering does not mean that the first undertaking necessarily comes to an end.Even though it was not known what type of equipment was used for cleaning work and it was possible that some changes in cleaning methods had been introduced by the new contractor, the Court of Appeal noted that hospital cleaning 'although of the utmost importance is not an operation that lends itself to the employment of many different techniques'.

The cleaning was to be carried out by mainly the same staff on the same premises and for the same clients.On the agreed facts, therefore, the Court of Appeal was prepared to hold that a relevant transfer had taken place.

Many commentators have already argued that this decision will inhibit the process of competitive tendering given the employment costs and liabilities which may fall on contractors if the regulations apply.Moreover, the transferor's liability may be more extensive than had hitherto been thought following the decision of the EAT in Allan v Stirling District Council [1994] IRLR 208.

After a compulsory competitive tendering exercise, an in-house tender for the work in which the appellants were employed was rejected and they were made redundant.

On the same date, the con tract was awarded to an outside business.

The employees claimed to have been unfairly dismissed by the council.An industrial tribunal concluded that the dismissals were unfair but that liability to compensate the appellants must fall upon the transferee.

The EAT allowed an appeal against the latter finding.

It found that, although on a straightforward application of the words of reg 5(2) the dismissals were deemed to have been carried out by the transferee, reg 5(2) did not mean that the act of dismissal was deemed to have been done by the transferee to the exclusion of the transferor.

To hold otherwise would have been inconsistent with the main objective of the Directive and of the regulations, ie the protection of employment rights.The European Court's decision in Commission of the European Communities v United Kingdom [1994] The Times, 27 June, has been the subject of widespread media coverage.

Briefly, the European Court ruled that UK implementation of the Acquired Rights Directive (and also the Collective Redundancies Directive) had been defective.

Several defects were rectified by the Trade Union Reform and Employment Rights Act 1993.

However, the decision highlights one continuing gap in UK law, ie the absence of a requirement to inform and consult workers' representatives about circumstances envisaged by the Directives.

It will be interesting to see how the government responds to the decision: the compulsory recognition by employers of trade unions is not, however, a necessary response.

It seems that, at least, where there are worker representatives within the affected enterprise, employers will need to have a formal mechanism for consulting with them about proposed changes falling within the scope of the Directives.EQUAL PAYBritish Coal Corporation v Smith, North Yorkshire County Council v Ratcliffe [1994] IRLR 342, concerned an applicant claiming equal pay who sought to compare her pay with that of a man employed by the same or associated employer at a separate establishment.

The Court of Appeal held that she had to show that the terms and conditions of employment for men of the relevant class at that establishment were the same as those of men of the relevant class employed at her establishment or which would be available for male employees for that work at her establishment.

A broad similarity was not enough.

Women canteen workers and cleaners employed by British Coal could be treated as being in the same employment as a male surface mine worker at a different establishment only if the latter were employed at an establishment where agreed terms relating to incentives and concessionary coal were the same as where the applicant was employed.On the facts of the case, British Coal failed to prove that the variation between the contractual terms applicable to the women claiming equal pay and those applicable to the male comparators was genuinely due to a material factor which was not the difference of sex.However, in linked proceedings, dinner ladies employed by a local authority were not directly discriminated against when, as a result of competitive tendering, their pay was reduced in order to compete at commercial rates.

The fact that the rates offered by an outside organisation with which the authority was competing for the school dinner tender might have discriminated against women did not make them directly discriminatory when offered by the authority, since they were genuinely due to the operation of market forces, which was a material factor other than sex.

The authority's successful reliance on the 'mat erial factor' defence created by s.1(3) of the Equal Pay Act 1970 illustrates a potentially important limit on the right to equal pay.The complexity of equal pay law is widely acknowledged, as is the protracted nature of equal value proceedings in particular.

The government has taken several steps of late which may reduce, but will certainly not eliminate, the delays.

A respondent's specific right to re-open the 'genuine material factor' defence at a later stage if that defence has already been put forward as a preliminary point has been removed, and it is also proposed to amend the Act further to abolish a tribunal's power to dismiss an equal value claim as 'disclosing no reasonable grounds' for the allegation that the jobs are of equal value, provided that adequate powers remain to prevent obviously hopeless cases from proceeding.Independent experts, whose role in equal value claims has become increasingly controversial, must now estimate how long they will take to produce their reports and the government has invited views on further changes to the independent expert system.

Currently, it seems to favour giving to an industrial tribunal the power to decide whether or not to commission an expert's report.

A more radical solution, that of abolishing the expert's role altogether, has also been canvassed.

This would be more likely to speed up claims, which overall would be to the advantage of applicants, even though lack of independent expertise might disadvantage some equal value claimants, especially where they are unrepresented.MATERNITY LEAVENotoriously, the legal rules on maternity leave abound with traps for the unwary.

Hilton International Hotels (UK) Ltd v Kaissi [1994] IRLR 270, illustrates the problems.

A hotel chambermaid's maternity leave began on 14 September and her baby was born on 30 October.

She received sick pay throughout September and October.

She failed to give notice of intention to return to work under s.33 of the 1978 Act and her employment was terminated by letter on 25 February.An industrial tribunal held that she was employed until 25 February and that her dismissal was unfair.

The employers argued that her contract had ended before 25 February because of her failure to follow the correct notification procedures, but the EAT ruled that the question of whether the contract came to an end as a result of such failure or continued depended on the agreement and actions of the parties, which might differ from case to case.

On the facts of this case, the employment continued until the letter of 25 February was sent, dismissing the employee unfairly.OTHER DEVELOPMENTSThe Race Relations (Remedies) Act 1994 came into force on 3 July 1994.

It repeals the upper limit (currently £11,000) on the compensation which an industrial tribunal can award to someone making a complaint of race discrimination.

It also removes the same upper limit on the aggregate compensation which can be awarded in respect of acts which constitute both race discrimination and unfair dismissal.

At the time of writing, the government had not announced any increase whatsoever of the maximum limits of payments made pursuant to employment protection legislation - including the maximum amount of a compensatory award for unfair dismissal.

The contrast between the compensation now available to those suffering discrimination and those who are victims of unfair dismissal looks increasingly bizarre.The Industrial Tribunals Extension of Jurisdiction (England and Wales) Order 1994 was laid in draft before Parliament on 11 May 1994 and came into force on 12 July.

It enables an employee to bring industrial tribunal proceedings in respect of a claim for damages for breach of his or her employment contract or any contract connected with the employment; a sum due under any such contract; and a sum due pursuant to any enactment relating to the terms or performance of such contract.

The claim must arise or be outstanding on the termination of employment and claims for damages for personal injury and claims relating to the provision of living accommodation, intellectual property, confidentiality and restraint of trade are excluded.

The tribunal may not order payment of a sum exceeding £25,000.An employee must bring a complaint within three months, beginning with the effective date of termination of employment or, if there is none, the last day worked.

Significantly, employers can bring counter-claims against employees who have brought a claim under the order.

Such a claim must be presented within six weeks of the day on which the employer receives the originating application.

It seems safe to predict that the introduction of these new provisions will lead to a significant increase in the number of industrial tribunal cases, further straining an already overburdened system.