Mayeur v Association Promotion de L'information Messine (APIM) [2000] IRLR 783 (ECJ)
Collino v Telecom Italia SPA [2000] IRLR 788 (ECJ)
The European Court is still finding itself occupied with cases on TUPE and the Acquired Rights Directive.
These two latest cases concern the scope of the exclusion from the Directive of transfers of administrative functions between public authorities. This derives from the ECJ's decision in Henke (LELR 5) and is now enshrined in the amendments to Article 1 of the Directive which must be brought into force in the UK by 17 July 2001.
The UK Labour government takes the view that the exclusion is very limited. This is reflected in its Cabinet Office guidance "Staff Transfers in the Public Sector" where there is a general assumption that the Directive will apply and a policy statement that public authorities should behave as though it applies, even where there is doubt. Also, the power in section 38 of the Employment Relations Act 1999 to order that particular transfers of functions between state authorities should be treated as though TUPE applied, has already been exercised in the transfer of Rent Officer functions.
Fortunately, the European Court appears to take a similarly limited view of the scope of the Henke exclusion.
Collino concerned a telecommunications services operation managed by a public body which was transferred to a private company. The Court concluded that the fact that the service transferred was the subject of a concession by a public body could not exclude the Directive. The activity concerned amounted to a business activity rather than the exercise of public authority.
Similarly in Mayeur where the activities of a non-profit making association which aimed to promote opportunities offered by the City of Metz were taken over by the local authority. The Court reaffirmed the application of the Directive to public and private entities, regardless of the legal status of the entity or the manner in which it is funded.
The Court took the view that Henke only excluded the reorganisation of structures of the public administration or the transfer of administrative functions between public administrative authorities.
This restrictive interpretation is welcome and means that very few UK transfers will be caught by the Henke exclusion, as illustrated by the case of Dundee City Council v
Arshad (EAT) which pre-dates these ECJ cases.
The Court also affirms the view long ago stated in the Daddy's Dance Hall case [1988] IRLR 315. Although there may be changes to terms and conditions by agreement following a transfer where that is permitted by national law, there may never be valid agreed changes where the transfer of undertaking itself is the reason for the amendment.
So an employer cannot validly introduce changes, even by agreement, where the transfer is the reason for the change. Action taken a considerable time after the transfer may still be prohibited as being connected with the transfer, as illustrated by the case of Taylor v Connex (IDS Brief 670) where an employee succeeded in a claim where he was dismissed long after the transfer for refusing to accept changes which were being introduced by reason of the transfer.