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Transfer and new employers

Published 04 February 2013

The recent decision of the EAT in Edinburgh Home-Link Partnership v The City of Edinburgh Council is being seen as another demonstration of the failure of the Labour Government's 'service provision change' amendment, introduced in TUPE 2006. To recap, this was introduced to try and encourage employee retention in respect of out-sourced activities that are transferred or brought in-house. Hitherto, decisions of the CJEU had been unfavourable for employees who argued for transfer under the original model, particularly towards those engaged in single entity activities. The 'service provision change' was introduced to address this perceived need for greater protection for this class of employees.Edinburgh concerned two directors of a homeless person’s charity. The council decided to take in-house the front-line work of that charity. The question was whether the directors were assigned to that part of the charity the council intended to take in-house; the directors had other work in parallel organisations and they divided their time accordingly between the organisations as a whole.

What this case demonstrates is how fact-sensitive the outcomes in such cases are. This may seem obvious, but with a lack of clear guidelines, which higher courts have refused to provide in earlier cases, employees who are looking for concrete protection at or just before the moment of transfer can find the process just bewildering. The question in Edinburgh, as in any other case is, was the employee, prior to transfer, assigned to the organised grouping of employees which was organised to have as its principal purpose the carrying out of activities for which the client contracted, on the client's behalf? Employee perception of how integral they feel they may be to an organisation may depend on a lot of factors, but they will not necessarily know whether what they see as important will carry sway at the key moment of transfer.

The Government is reviewing the operation of TUPE and it is hope that the current shortcomings will be considered.

Carl Fender Barrister
Regency Barristers Chambers
45 Priestgate Peterborough.
01733 315 215
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