An Employment Tribunal has held that the Transfer of Undertakings (Protection of Employment) Regulations 2006, (“TUPE”) apply to ‘workers’ as well as ‘employees’. Whilst Employment Tribunal decisions are not a legally binding precedent, in the event that this decision is to be found to be correct by a higher court, businesses will have obligations to inform and consult with both its employees and workers in respect of TUPE transfers.
The Facts
In the case of Dewhurst and Others v Revisecatch Limited t/a Ecourier and City Sprint (UK) Ltd the Claimants were cycle couriers, who provided services to City Sprint in respect of City Sprint’s contract with HCA Healthcare. City Sprint lost the contract to Ecourier.
The Claimants brought claims under the Transfer of Undertakings (Protection of Employment) Regulations 2006, (“TUPE”), for a failure to inform and consult about the transfer, pursuant to Regulations 13 and 14 TUPE.
TUPE seeks to protect the rights of employees in a business transfer or service provision change situation. However, TUPE uses a wider definition of ‘employee’ than many other pieces of employment legislation, including the Employment Rights Act (“ERA”) 1996.
A Preliminary Hearing was listed to determine whether the definition of “employee” under TUPE is wide enough to apply to so-called “limb b” workers (which would include the couriers). The definition for such “limb b” workers is set out under section 230(3)(b) ERA 1996 as any contract, (other than a contract of employment), “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
Rather surprisingly, the Employment Tribunal held that TUPE does apply to “limb b” workers.
It should be noted that as this is a first instance decision, it is not binding upon other Employment Tribunals. However, the reasoning of the Tribunal in Dewhust may well be used in future cases. Whilst this particular decision does not appear to have been appealed, in the event that the Employment Appeal Tribunal were to determine that “limb b” workers are covered by TUPE, this will form a legally binding decision, which would mean that “workers” as well as “employees” have the right to be informed and consulted under the TUPE Regulations.
What does this mean for you?
As a result of this decision, any businesses planning to undertake a TUPE transfer process needs to give serious thought as to who should be informed and consulted in the TUPE process in order to minimise the risk of liability on their business. The remedy for a claim for failure to inform and consult is up to 13 weeks’ pay per affected employee. We would recommend that specialist advice is sought in any such situation.
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