TUPE service provision change: lay off does not prevent organised group of employees

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Laying off employees before a service provision change does not necessarily prevent them from transferring to the new employer under TUPE. Lindsay Macdonald reports on a recent case at the Employment Appeal Tribunal (EAT). Inex Home Improvements Ltd v Hodgkins and others

Background

The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) cover both traditional business transfers and service provision changes. One of the conditions that must be satisfied to enable a service provision change is the existence, immediately before the transfer, of an organised grouping of employees whose principal purpose is to carry out the relevant activities.

Facts

Contractor Thomas Vale engaged Inex Home Improvements Ltd as a sub-contractor to work on a particular contract. The work was released by Thomas Vale to Inex in tranches, each with an individual works number. Inex's employees were employed on the terms of the Construction Industry Joint Council Working Rule Agreement. The agreement provided that, where work temporarily ceased or was not provided by the employer, the employees may be temporarily laid off. In these circumstances, the employees would receive remuneration for a limited period of time and would be required to register as available for work at their local Job Centre. During November and December 2012, Inex completed the works sub