TUPE or not TUPE? - Fragmentation
With the ever increasing court rulings interpreting the provisions of the Transfer of Undertaking (Protection of Employment) Regulations 2006 (TUPE) it has never been more complicated to determine whether TUPE applies to business transfers or service provision changes. Service provision changes are particularly problematic and even Tribunal Judges can get it wrong!
In the case of Carewatch Care Services Ltd v Henry & Others 2018 Sevacare had been delivering care packages to 168 service users on behalf of the London Borough of Haringey (LBH) since 2004. In 2012 LBH opened the service up to other care service providers with Sevacare remaining as the main provider. On the 14 June 2016 Sevacare served notice on LBH that it intended to withdraw its services ending on 15 July 2016.
Sevacare argued that TUPE applied and that the carers who currently serviced the contract should transfer to the new providers. The other service providers objected to this and said the activity of providing home care packages was so fragmented that TUPE could not apply.
The carers brought Tribunal claims. The Employment Judge (EJ) sided with the carers and ruled that they should have transferred under TUPE to the new providers.
The providers appealed on the following grounds:
(i) The EJ should have found that the relevant activity was so fragmented as to preclude any finding of a service provision change (Ground 1).
(ii) The EJ erred in concluding that the activities were carried out pre-transfer by an organised grouping of employees which has as its principal purpose the carrying out of the activities concerned on behalf of the client (Ground 2).
(iii) The EJ erred in concluding that each Claimant was assigned to such an organised grouping (Ground 3).
(iv) The EJ's reasons were defective in various respects, in particular in relation to fragmentation, organised grouping and assignment (Ground 4).
The EAT held that the Employment Tribunal ‘had not properly considered the issues of (1) fragmentation, and (2) whether the relevant activities had been carried out pre-transfer by an organised grouping of employees which had as its principal purpose the carrying out of the activities concerned on behalf of the client. Further the Employment Judge's reasons were defective in various respects’.
The EAT have remitted the case back to a different Tribunal to consider these points.
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