News Feed
Mr Love and Mrs Scott were employed solicitors working for Ward Hadaway, a law firm in Newcastle which acted generally, with other firms, for the Nursing & Midwifery Council (NMC). Mr Love and Mrs Scott principal work was for that client, the NMC. In 2007 the NMC decided to use a single London law firm, Capsticks LLP.
A question then arose as to whether Mr Love and Mrs Scott automatically transferred to Capsticks by operation of law under the "service provision change" provisions introduced by the TUPE 2006 reg 3 ("TUPE").
Mr Love and Mrs Scott, although formally involved in the case, had no real interest in it as they had been dismissed. The real question was whether any unfair dismissal compensation due to them should be paid by Ward Hadaway or by Capsticks. Ward Hadaway argued that Capsticks had to pay on the basis that TUPE applied and therefore the two solicitors' employment contracts had automatically transferred to Capsticks. Capsticks argued that the TUPE regs did not apply, therefore Mr Love and Mrs Scott remained employees of Ward Hadaway and therefore Ward Hadaway was liable to pay any unfair dismissal compensation.
The matter turned on the proper interpretation of the TUPE regulations and their application to the facts. An employment judge agreed with Capsticks that the TUPE regs did not apply, that Mr Love and Mrs Scott remained employees of Ward Hadaway and therefore that Ward Hadaway was liable to pay any unfair dismissal compensation. Ward Hadaway appealed to the EAT.
Ward Hadaway have lost their appeal and the EAT refused to give them permission to appeal on to the Court of Appeal.
In order to win, Ward Hadaway would have had to overcome two hurdles.
Firstly, to show that Mr Love and Mrs Scott formed "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" (TUPE regulations SI 2006/246 reg 3(3)(a)(i)); and secondly to show that those "activities cease to be carried out by a contractor on a client's behalf ...... and are carried out instead by another person ("a subsequent contractor") on the client's behalf (TUPE regulations SI 2006/246 reg 3(1)(b)(ii)).
Ward Hadaway cleared the first hurdle but fell at the second. As the employment tribunal before it had done, the EAT found that Mr Love and Mrs Scott did form "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".
However it found that there were no activities which had ceased to be carried out by Ward Hadaway. Although the NMC sent new work to Capsticks, Ward Hadaway went on with any cases it was working on for NMC - there were some 100 to 140 such cases providing work for at least six months (even at 31st March 2009 there was work in progress on at least two major cases) therefore there was no service provision change.
