Weekly dilemma: TUPE

Our company has won some outsourced work from a client and, under TUPE 2006, I understand this may qualify as a ‘service provision change’, so we will take on the staff who were dedicated to carrying out this work. One term of employment we have no choice but to amend is the place of work, as staff cannot remain at our predecessor’s offices. Some have objected, but there is little the company can do about it. Are we at risk?

As you say, this sounds like a situation that may qualify as a ‘service provision change’ under the TUPE 2006 regulations. Employees will therefore be entitled to transfer on the same terms and conditions as they enjoyed with their original employer.

Under TUPE 2006, there is no need for an employee to demonstrate a fundamental breach of contract by the employer – or even any breach – a perceived ‘substantial change’ in working conditions to their ‘material detriment’ will suffice. The courts and tribunals have not yet decided what exactly will satisfy this definition, but DTI guidance suggests that a major relocation of workplace, making it more difficult or expensive to get to work, is likely to do so.

It is conceivable that relocation, resulting in an increase in commuting time, could be a substantial change to an employee’s detriment if, for example, it disrupts childcare arrangements. In these circumstances, resignation may constitute dismissal, and would probably be automatically unfair on the grounds that it was related to the transfer (although DTI guidance suggests tribunals should still apply the reasonableness test). While we have yet to see how courts and tribunals address this point, on the face of it, a claim for automatically unfair dismissal could succeed without any unlawful action on your company’s part.

Short of opening up a new office close to your predecessor’s premises, there is no straightforward way around it, at least until there has been some case law in this area. The best advice is to consult with the employee, review possible solutions to their difficulties, and ensure that the company acts reasonably at every stage. This will ensure that if the matter does end up before a tribunal chairman, and that chairman does apply the reasonableness test, the company cannot be criticised.

William Bateman, employment lawyer, Glaisyers

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