Question As To Whether A Business Transfer Between Two Construction Companies Had Occurred

A company (the "Company") had been undertaking real estate development projects and its subsidiary (the "Subsidiary") had been contracted to perform building operations in relation to these development projects. The Subsidiary had been suffering serious problems with its business and it was therefore decided to liquidate it. In connection with the liquidation, the staff were informed in writing that cooperation with another building contractor (the "Building Contractor") was to be initiated. The Subsidiary had at that point in time an ongoing contract that was transferred to the Building Contractor.

The Subsidiary was subsequently declared insolvent. Some of the Subsidiary's employees were not transferred to the Building Contractor. Two of those employees commenced proceedings through their trade union (the "Union") against the Building Contractor and claimed that there had been a business transfer since the Building Contractor had taken over the ongoing