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Wishing, hoping and TUPEing

Shared Services 3 iStock 000009458297Small 146x219This month the Employment Appeal Tribunal has considered what is meant by an 'intention' that a contract will be short term and, therefore, exempt from TUPE – can it be a 'hope' or a 'wish' that the contract will be short term, or does it need to be more concrete? Sarah Lamont reports.

This question was looked at by the EAT in the context of employees providing home care to a patient pending a Court of Protection application. The EAT also looked at whether an employee who was suspended from work at the time of the transfer was 'assigned' for the purposes of TUPE.

The background

The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) operate so that when there is a change in employer, employees transfer to the incoming employer without any adverse effect on employment rights. This covers two broad situations.

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  1. A traditional ‘business transfer’: where one organisation is transferred into the hands of another organisation.
  2. A ‘service provision change’ (SPC): where a client engages a contractor to do work on its behalf (outsourcing); reassigns such a contract from one contractor to another (retendering); or brings the work ‘in-house’ (where a contract ends with the service being performed in-house by the client themselves).

Regulation 3(3)(a) of TUPE requires that, immediately before the service provision change:

  • there is an organised grouping of employees situated in Great Britain which has as its principal purpose the carrying out of the activities concerned on behalf of the client (regulation 3(3)(a)(i)); and
  • the client intends that the relevant activities will, following the service provision change, be carried out by the transferee other than in connection with a single specific event or task of short-term duration (regulation 3(3)(a)(ii)) [our emphasis].

There is no definition of 'intends' in TUPE, so courts and tribunals will use its natural meaning, in accordance with the purpose of the Regulations.

Furthermore, TUPE only operates to transfer the employment of those employees who are "assigned" to the outgoing organisation (regulation 4(1)), and this is decided by looking at where the employee would be required to work immediately before the transfer.

In Robert Sage t/a Prestige Nursing Care v O'Connell the Employment Appeal Tribunal considered the meaning of the word 'intends' in the exception set out above and looked at whether an employee who had been suspended was 'assigned' to the relevant contract and therefore covered by TUPE. 

The facts

A group of care support workers were employed by a company called Allied Healthcare Group Limited (Allied), which had contracted with North Somerset Council to provide home care for X, who had severe learning difficulties. One of the group, Mrs Truman, had been suspended from her duties, at the request of the council, following a disciplinary issue. The council had told Allied that it did not want Mrs Truman to work with X, and Allied told her that it would look for alternative employment for her elsewhere.

The council terminated its contract with Allied, and it was agreed that another care provider, Prestige Nursing Care (Prestige) would take over the care of X. However, the council had made a Court of Protection application seeking to transfer X to new accommodation, and, if this application was successful, X would no longer require home care. 

The Allied employees were told that they were no longer needed as Prestige would be covering an interim period before the court hearing, which was expected to be held four weeks later. Prestige provided X's care using its own support workers.

Rather than taking place within four weeks, the Court of Protection proceedings were delayed by approximately one year and were finally withdrawn. Prestige continued providing care for X in her home, as they had done since the contract with Allied had been terminated by the council.

The Allied employees brought claims for unfair dismissal against Prestige and the council. Prestige sought to rely on the exception to TUPE set out above, arguing that the contract was intended to be of short term duration because their client (the council) had commissioned the service as "temporary emergency cover pending the decision of the Court of Protection"; they had not envisaged that the contract would last as long as it did.

Prestige argued that, if TUPE applied (which it claimed it did not), Mrs Truman was not assigned to the contract because of her suspension from work.

The decision

'Hope or wish' not the same as 'intends'

The EAT held that Prestige was not entitled to rely on the TUPE exemption set out above, as there was insufficient certainty in their client's 'intention' that the contract would be short term.

The EAT said that the natural meaning of the word 'intention' is more than 'hope' or 'wish'; there must be a reasonable prospect of achieving the object of the intention. The EAT used the example of a person who says they 'hope' to run a marathon but it is meaningless to say they 'intend' to do so if they have never run more than a mile. Applying that logic to the facts of the case, the council could not have 'intended' the contract to be short term because that was dependent on the outcome of the Court of Protection proceedings, over which the council had no control – they could only 'hope' that the proceedings would take place in four weeks; it could not have been their intention, especially given the notoriously unpredictable nature of court proceedings. 

Suspended employee not assigned

The EAT said that Mrs Truman was not 'assigned' for the purposes of TUPE because she had not been permitted to return to work with X. Although that was her contractual place of work, that was superseded by the prohibition on her working there, and she was not eligible to transfer.

What does this mean for me?

There has been a growing body of judicial comment on the application of the 'short term task / event' exemption from TUPE (please click here for a summary). This most recent case provides some clarity that the scope of the exemption is limited to circumstances were employers have a high degree of certainty that the contract in question will be short term. If the duration of the contract is dependent on factors beyond the employer's control, then it is possible that the exemption will not apply.

In respect of the assignment point, it is important to note that not all employees who are suspended will be excluded from the scope of TUPE; the fact that Mrs Truman was precluded from working with X, because of the council's request, was decisive.

Sarah Lamont Sarah Lamont is a Partner at Bevan Brittan. She can be contacted on 0870 194 8943 or This email address is being protected from spambots. You need JavaScript enabled to view it..

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