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TUPE: service provision changes

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Does the principle established by the European Court of Justice in ISS Facility Services NV v Govaerts that under the Acquired Rights Directive employees may transfer to multiple transferees also apply to a service provision change transfer under regulation 3(1)(b) of TUPE?

Yes, held the EAT in McTear Contracts Ltd v Bennett & ors.

The case involved a client local authority who re-tendered a contract for replacement of kitchens within its social housing stock which had previously been carried out by a single contractor who had two dedicated teams assigned to this work. The contract was awarded to two new contractors on a geographical basis. They accepted that there had been a service provision change but appealed against the tribunal’s allocation of the transferor’s employees.

Despite there being no requirement to apply Govaerts to the domestic SPC provisions under regulation 3(1)(b), the EAT was persuaded that it would be undesirable for there to be a difference in the approach to the transfer of employment under Regulation 4 according to whether the relevant transfer was a business transfer under Regulation 3(1)(a) or a SPC under Regulation 3(1)(b).

Thanks to Tim Cross of Vista Employer Services for preparing this case summary.