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TUPE: Can a sub-contractors' employees transfer to the client when the work is taken back in-house?

11 June 2015 #Employment


It is common for services to be contracted out to by a client a main contractor and then for that main contractor to then sub-contract some or all of the services to a sub-contractor.

This rather complex mix of relationships was the focus in Jinks v London Borough of Havering [2015]. The Council contracted Saturn to operate an ice rink and car park. Saturn then sub-contracted the management of the car park to Regal. Jinks worked for Regal. Saturn subsequently gave up the car park, which meant that Regal was no longer managing it. The responsibility for the car park passed back to the Council who passed it on to a local NHS Trust. Jinks argued that his employment transferred from Regal to the Council.

Jinks argued that the management of the car park had been contracted out, and then taken back in-house, and hence was covered by the service provision change provisions within TUPE. However, the Council argued that it was not covered because Regal provided a service for Saturn, not the Council.

The EAT ruled that the situation could be covered by the TUPE regulations. The question is on whose behalf was Regal running the car park? There is no requirement to have a legal or contractual relationship; the question is who in reality is the service being provided for? The case has been sent back to the Tribunal to answer this question.

If you are involved in a transfer situation or negotiating a new services contract involving the subcontracting of services be mindful of this ruling, because TUPE might extend further than was previously thought. 

Kathy Daniels

Forbury People Consultant

Clarkslegal, specialist Employment lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Employment matter please contact Clarkslegal's employment team by email at employmentunit@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.

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