September 30, 2016

Was There a Service Provision Change?

In CT Plus (Yorkshire) CIC v Black and others UKEAT/0035/16, the Employment Appeal Tribunal (EAT) considered whether TUPE applied when a park-and-ride service was changed.

Hull City Council engaged a bus company called CTP to operate a park-and-ride service. Stagecoach decided to set up in competition with CTP, and this led to Hull City Council cancelling its contract with CTP. CTP claimed that this gave rise to a service provision change under TUPE and that its drivers should have transferred to Stagecoach.

The EAT disagreed. It said on a plain reading of TUPE there had been no service provision change. Specifically, TUPE requires the service to be carried out by or on behalf of a ‘client,’ both before and after the transfer. Here, the client might initially have been Hull City Council but there was no such client after the alleged transfer; Stagecoach was operating on its own account and not on behalf of the Council. In the circumstances, the EAT felt that the Council was merely an “interested bystander.” 

While this is not new law, it does highlight the fact that TUPE is a technical area and organisations should consider the legislation carefully before determining whether there may be a transfer of employees.

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