The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) state that immediately before a service provision change (SPC) takes place, there has to be an organised grouping of employees dedicated to carrying out the activities concerned. In Jakowlew v Saga Care and Westminster Homecare Ltd, the Employment Appeal Tribunal (EAT) held that a third party cannot decide what grouping of workers a particular worker is assigned to.

Basic facts

Ms Jakowlew worked as a care manager for Saga mainly for a contract with the London Borough of Enfield. On 14 June 2013, Enfield expressed concern to Saga about an incident that had taken place in February when Ms Jakowlew was suspended on full pay, along with three colleagues, and wanted to know why they had not been disciplined.

On 19 June, Enfield used its right under Clause 10.5 of the contract to instruct Saga to remove the three employees from the contract. Saga objected on the basis that the notice given by the authority was both “unreasonable and vexatious”. In the meantime, Saga held a disciplinary hearing and gave Ms Jakowlew a written warning. Saga’s contract with Enfield ended on 30 June 2013 and transferred to Westminster Homecare on 1 July 2013.

Ms Jakowlew was initially told that her employment would TUPE-transfer over to Westminster, but Saga and Westminster decided at the end of July 2013 that she was still Saga’s employee. Ms Jakowlew was dismissed by Saga by reason of redundancy in September 2013. She claimed unfair dismissal against both Saga and Westminster.

Relevant law

Regulation 3(1)(b) of TUPE states that immediately before a service provision change when activities cease to be carried out by a contractor on a client’s behalf and are carried on instead by another contractor, there has to be an organised grouping of employees ”which has as its principal purpose the carrying out of the activities concerned on behalf of the client”.

Tribunal decision

The tribunal accepted that there had been an SPC with the result that TUPE applied. However, it also found that immediately before the transfer Ms Jakowlew had been removed from the service as a result of the letter from Enfield Council dated 19 June 2013.

The tribunal held that the confusion between Saga and Westminster as to whether Ms Jakowlew had transferred was irrelevant because on 1 July 2013 she was not assigned to the organised grouping which carried out the Enfield Council contract and therefore did not transfer. As such, Ms Jakowlew remained Saga’s employee.

EAT decision

The EAT upheld Ms Jakowlew’s appeal and explained that the key question was whether, immediately before the transfer, she would have been required by Saga to work in the organised grouping of employees, if she had not been excused from attendance. Interestingly, the EAT held that her suspension was another excusal from attendance, like holiday, study leave and sickness absence. There was no reason why suspending an employee on full pay pending disciplinary proceedings should result in being removed from the organised grouping to which the employee belonged.

Although Enfield had a right under the service contract to instruct Saga to remove an employee by virtue of clause 10.5, it was still for Saga (as the employer) to decide what grouping of workers was assigned to the service. As Saga did not act on the instruction by Enfield (and in fact disputed its correctness), the EAT decided that Ms Jakowlew remained assigned to the contract with Enfield and TUPE-transferred over to Westminster.

Comment

The novel point in this case was that the employer failed to act on the instruction of the client to remove the employee from the service. By itself, the instruction was not sufficient to remove the suspended employee from being assigned and TUPE-transferred, as she was to be treated in the same way as anyone else legitimately excused from attendance.