TUPE
A factual scenario which is becoming more and more of an issue as a consequence of the strategic spending review and a challenging economic environment is the TUPE transfers involved in transferring positions back in-house from an outside agency.
Company A is a local government. Over the last 4 years, company A has requested that a local recruitment agency find staff for its security functions. This agency has contacted company B, a well known supplier of security staff, to provide temporary and full time employees to supply company A. Brenda is one of these workers. She is employed by company B at company A's premises for seven months.
Company A meanwhile is faced with a redundancy situation and as such establishes a 'pool' of workers who jobs have dissipated, to be redeployed where available. There are significant cost savings in redeploying staff this way, especially if they take the role of expensive staff provided by company B.
Operations managers at company A therefore decide to replace all staff of company B who has less than one years' service with staff from their 'pool'. They chose staff with less than one years' employment to minimize the risk of Tribunal claims, though technically they appreciate that Company B is the employer.
The legal problem arises when Brenda claims that her position has been TUPE transferred BACK in-house citing the service provision changes in Regulation 3(1)(b) of the 2006 TUPE Regulations.
The problem here for employers is not that this is an overly technical approach to TUPE matters, nor that this is an unusual set of facts - indeed the opposite is probably true for the next few years at least - rather the problem is that this is not the sort of factual situation that HR managers and operations managers are used to dealing with re TUPE. Over the last decade there has been a more or less total flow of service provision changes from in-house to out-house (so to speak), rather than in the opposite direction.
We recently advised on a case in just this situation. Fortunately the individual concerned was a 'worker' and thus not covered by the TUPE Regulations. Though this was not a consideration that occurred to the managers in question, and a TUPE situation was avoided by luck rather than design.
The other significant danger posed by this situation is the 13 week salary protective award, provided for EACH employee affected. This can cause substantial harm to an organizations bottom line.
A factual scenario which is becoming more and more of an issue as a consequence of the strategic spending review and a challenging economic environment is the TUPE transfers involved in transferring positions back in-house from an outside agency.
Company A is a local government. Over the last 4 years, company A has requested that a local recruitment agency find staff for its security functions. This agency has contacted company B, a well known supplier of security staff, to provide temporary and full time employees to supply company A. Brenda is one of these workers. She is employed by company B at company A's premises for seven months.
Company A meanwhile is faced with a redundancy situation and as such establishes a 'pool' of workers who jobs have dissipated, to be redeployed where available. There are significant cost savings in redeploying staff this way, especially if they take the role of expensive staff provided by company B.
Operations managers at company A therefore decide to replace all staff of company B who has less than one years' service with staff from their 'pool'. They chose staff with less than one years' employment to minimize the risk of Tribunal claims, though technically they appreciate that Company B is the employer.
The legal problem arises when Brenda claims that her position has been TUPE transferred BACK in-house citing the service provision changes in Regulation 3(1)(b) of the 2006 TUPE Regulations.
The problem here for employers is not that this is an overly technical approach to TUPE matters, nor that this is an unusual set of facts - indeed the opposite is probably true for the next few years at least - rather the problem is that this is not the sort of factual situation that HR managers and operations managers are used to dealing with re TUPE. Over the last decade there has been a more or less total flow of service provision changes from in-house to out-house (so to speak), rather than in the opposite direction.
We recently advised on a case in just this situation. Fortunately the individual concerned was a 'worker' and thus not covered by the TUPE Regulations. Though this was not a consideration that occurred to the managers in question, and a TUPE situation was avoided by luck rather than design.
The other significant danger posed by this situation is the 13 week salary protective award, provided for EACH employee affected. This can cause substantial harm to an organizations bottom line.