The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) state that employees can terminate their contract in the event of a breach by the employer. In Abellio London Ltd v CentreWest London Buses Ltd, the Employment Appeal Tribunal (EAT) held that employees who resigned following a change to their place of work as part of a TUPE transfer had been constructively dismissed.
All five claimants were bus drivers for CentreWest on the 414 bus route, which operated out of the Westbourne Park depot in west London. This suited their family circumstances and where they lived.
Their contracts stated that they could be asked at any time to transfer to one of a number of specific depots as defined by the company; and that the company had the right, after consultation, to vary any of the terms of their contracts.
On 17 September 2009 CentreWest wrote to the drivers to tell them that their employment was to be transferred to Abellio as part of a service provision change under the TUPE Regulations from 21 November 2009.
The drivers were unhappy about Abellio’s decision to operate the route out of its Battersea depot in south London because it would increase their journey time to work significantly. All five brought claims under the TUPE Regulations for constructive, automatically unfair, dismissal.
Regulation 4(9) states that if the transfer involves a “substantial change in working conditions to the material detriment” of an employee, they can “treat the contract as having been terminated”.
Regulation 4(11) states that, in the event of a repudiatory breach of contract by the employer, the employee can terminate their contract without notice.
The Tribunal held that the September letter sent by CentreWest to its employees could not constitute a valid variation because, at the time it was written, the company did not have a depot in Battersea.
As a result, allowing the locations to be read as a list of Abellio’s depots with immediate effect from the transfer “would be to alter the terms of the contract to the disadvantage of the employees”, contrary to regulation 4(9).
The change of base from Westbourne Park to Battersea was not therefore permitted by the terms of the drivers’ contracts at the transfer date and the requirement to relocate was a repudiatory breach of contract. Finally it decided that the drivers had all resigned in response to that breach and had therefore been constructively dismissed.
And the EAT agreed. It said that the phrase “working conditions” was wider than “contractual conditions” and was capable of relating “to matters such as the place of work”.
The change of depot represented a material detriment to the drivers’ working conditions as the new location involved a much longer and more difficult journey to work and was not “trivial or insubstantial”. It was, therefore a "substantial change in working conditions".
The drivers had resigned in response to those changes and the dismissals were automatically unfair, as they were for a reason connected with the transfer.
The Tribunal was also entitled to conclude that there had been a breach of contract as Battersea was not one of the depots specified in the drivers’ contracts; and CentreWest had not varied the contracts to include it as a new depot to which they could be transferred.
This case illustrates the rare exception when an employee can object to automatic transfer under regulation 4(9). However, very careful thought should be given when an employee is considering taking a similar stance as they will have to show a “substantial change in working conditions” to their “material detriment”. If the employee can prove this they will still have to resign from their employment and claim constructive dismissal.