The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) provide protection and rights to “employees” who work for a business or on a contract that is transferred to another organisation.
A recent case from the London Central Employment Tribunal on the application of TUPE has potentially significantly broadened the class that benefit from the protection.
Dewhurst and Others v Revisecatch Limited t/as Ecourier and City Sprint (UK) Ltd*
The Claimants in this case are cycle couriers, they worked for Ecourier on its contract for HCA Healthcare. Ecourier lost the contract to City Sprint. They worked for Ecourier as self-employed contractors; they were not employees.
The Claimants have brought various claims against both Respondents including claims under TUPE for a failure to inform and consult with them about the contract transfer.
Regulation 2 of TUPE provides that the regulations apply to “employees”.
In order for their claims to proceed, the Employment Tribunal had to consider whether or not the scope of the term “employee” within regulation 2 of TUPE could include both employees and “workers” within UK law.
Workers are defined in Section 230(3)(b) of the Employment Rights Act 1996 (ERA) as:
“an individual who has entered in to or works under…any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual”.
Decision
The term “employee” for the purpose of TUPE also covers “workers” as defined by the ERA.
Implications
All workers who are affected by a TUPE transfer (or measures connected with it) have the right to be informed about and consulted on it. Compensation can be up to 13 weeks’ pay per qualifying person. Also, out-going employers will have to include workers in their Employee Liability Information.
However, workers will not benefit from the provisions on automatic unfair dismissal for those dismissed as a consequence of a TUPE transfer as unfair dismissal provisions apply only to traditional employees.
It is important to note that as first instance Tribunal decision, this judgement is not binding in other cases. However, the case may well be appealed and therefore we could have an authoritative decision in this arena in 2020.
In the meantime, employers and their advisers will need to think carefully about this in relation to any TUPE transfer and may decide to include any workers in order to minimise risk or may wish to seek additional indemnities from other parties to a transaction to deal with this risk.
*Dewhurst and others v (1) Revisecatch Ltd t/a Ecourier (2) City Sprint (UK) (Case Numbers: 2201909, 2201910, 2201911/2018)
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Laura Kearsley is a Partner in our expert Employment Law team.
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