In the case of Mr Alpha Anne and others v Great Ormond Street Hospital for Children NHS Foundation Trust [2026], the Employment Appeal Tribunal made an important judgment in relation to liability for TUPE and discrimination claims.
In cases involving contracted employees who are employed by one employer that is contracted to provide services to another client organisation, those employees cannot bring a claim against the client organisation in connection with their pay, as pay is contractually determined by their own employer. This position applies even where the client organisation has some influence over the situation.
Following a TUPE transfer, staff transferring from the contractor employer to the client organisation may be entitled to day one harmonisation of terms and conditions if the terms they currently have would amount to indirect discrimination when compared to the client organisation’s employees.
The impact of this ruling on day one harmonisation means that any employer who insources services must now give careful consideration to whether the transfer may result in indirect discrimination in relation to pay disparities between incoming employees and existing employees. Particular attention must be given to the onboarding process under TUPE.
Employers must conduct appropriate due diligence and consultation.
Where services are being insourced, it is vital that employers review the pay and benefits of transferring staff in comparison with their own employees, and consider whether employees may be discriminated against on the basis of protected characteristics due to pay differentials after the transfer takes place. Employers should request pay information at the earliest opportunity to ensure the correct day one action is taken. Employers should note that disclosure of this information goes beyond the usual TUPE employee liability information requirements and should therefore be addressed through contractual terms with the contractor.
Employers must also check whether the transferring employees’ contracts allow changes to terms and conditions of employment to facilitate any necessary changes. Where no such clause exists, the employer will need to justify any day one changes under Regulation 4(1) of TUPE.
Employers should actively engage in discussions with any recognised trade union regarding the TUPE transfer process. Where day one changes cannot be implemented, reaching an agreement with the union may help justify a delay, with an agreed timescale for implementing contractual changes.
If you need any further advice or assistance, please do not hesitate to contact the Quest HR Advice Line on 01455 852028.
