In the case of Inex Home Improvements Ltd v Hodgkins and others
UKEAT/0329/14 , the EAT found that employees that have been temporarily absent from work immediately before a service change provision would not necessarily preclude such employees from forming part of an organised grouping of employees within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE Regulations 2006”).
Under the TUPE regulations a service provision change will cover:
- activities that cease to be carried out by a person (“the client”) on his own behalf and
are instead carried out by another person on the client’s behalf;
- activities cease to be carried out by a contractor on a client’s behalf and are carried out instead by another person (“a subsequent contractor”) on the client’s behalf; or
- activities cease to be carried out by a contractor or a subsequent contractor on a client’s behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are carried out instead by the client on his own behalf.
The EAT’s reasoning in this case was based on the fact that there was nothing within the TUPE Regulations which required employees within an organised grouping to have been engaged in the transferring activity before the service provision change nor was there anything suggesting that a temporary cessation of activities would prevent the organised grouping from existing.
This judgment confirms that as with business transfers, service provision changes will also require parties to carefully consider all the potential employees that may, by the operation of law, be regarded as being assigned to the organised grouping to be transferred.
The decision taken by the EAT is not unexpected and takes a common sense approach to the purpose of the TUPE Regulations.
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