An appellate panel at the Employment Appeal Tribunal threw out a bid by a British doctors union and a GP to overturn a ruling that the GP's dismissal was not covered by work transfer regulations during the restructuring of his NHS employer. PW-LA advises employees and employers on TUPE work transfer regulations and reviews procedures adopted by employers to avoid an escalation of legal claims. Read on.................
The facts:
NHS Nottingham City Commissioning Group dismissed Bicknell from his position as clinical lead GP in 2020 following a merger with other clinical groups in the area to form the NHS Nottingham and Nottinghamshire Clinical Commissioning Group. The group has since been replaced by the NHS Nottingham and Nottinghamshire Integrated Care Board, the decision says.
Bicknell claimed that the care group made him redundant as a result of the merger, which would be in breach of TUPE, according to the trial judgment of 2022.
The legal detail:
The requirements for a TUPE (Transfer of Undertakings (Protection of Employment)) transfer encompass several key obligations and protections that must be adhered to by both the transferor and the transferee. These requirements are primarily aimed at safeguarding the rights of employees during the transfer process.
Firstly, TUPE regulations mandate the automatic transfer of employees and their employment contracts from the transferor to the transferee. This includes all rights, powers, duties, and liabilities associated with these contracts, except for rights related to occupational pension schemes which do not transfer. The transferee must also inherit any liabilities related to employees dismissed by the transferor if the dismissal is connected with the transfer. Dismissals where the transfer itself is the reason are considered automatically unfair unless justified by an economic, technical, or organisational reason.
An economic reason under TUPE regulations generally refers to factors related to the profitability or market performance of the business involved in the transfer. According to government guidance on TUPE, economic reasons are likely to include aspects that affect the financial health and competitive standing of the new employer's business.
These economic reasons must entail changes in the workforce to be considered valid under TUPE regulations. This means that the economic reasons should lead to alterations such as reductions in the number of employees or changes in their roles, functions, or the location of their employment. For instance, a change might involve employees moving from a managerial to a non-managerial role, or from one type of job to another, which reflects a shift in the business's operational needs or strategies.
It is crucial to note that for any dismissals or changes in employment terms to be legally justified under TUPE on the grounds of economic reasons, these must result in actual changes in the workforce. This includes not just theoretical or planned changes but changes that are implemented and affect the employment conditions or the structure of the workforce.
Additionally, TUPE imposes significant information and consultation duties. Both the transferor and transferee must inform and consult with the appropriate representatives of the affected employees if any measures are envisaged in relation to the transfer. This includes any changes to the employees' terms and conditions. The transferor is also required to provide the transferee with employee liability information, which includes details necessary to assess potential employment liabilities.
In summary, the TUPE transfer requirements are comprehensive, covering the automatic transfer of employees, the protection of their existing employment terms (with specific exceptions), the provision of pension rights, and the obligations for information sharing and consultation between the involved parties. These regulations ensure that employees are not disadvantaged by the transfer and maintain continuity in their terms of employment.
The ruling - In the case of (1) Bicknell (2) The British Medical Association v NHS Nottingham and Nottinghamshire Integrated Commissioning Board [2024] EAT 103, the Employment Appeal Tribunal (EAT) ruled that an employment tribunal rightly concluded that GP clinical lead Marcus Bicknell could not rely on the Transfer of Undertakings (Protection of Employment) Regulations 2006, SI 2006/246 (TUPE), in his challenge to his dismissal from NHS Nottingham City Commissioning Group.
Appellate Judge Clive Sheldon backed up the tribunal's finding that employees of clinical commissioning bodies do not qualify for work transfer protections because commissioning bodies do not supply goods or services and are therefore not involved in 'economic activity'.
The Employment Tribunal's conclusion was backed by Judge Sheldon that 'for there to be a transfer of an undertaking there has to have been the transfer of an economic entity from one person to another'. Rather, clinical commissioning bodies offer 'public administrative functions' which would not fall under the TUPE regulations.
'The Employment Tribunal stated clearly that the NHS Nottingham City Commissioning Group's core function was to arrange for the provision of health services, such that whatever was done other than commissioning or monitoring services was subordinate to its core role'.
The EAT found no fault with the Employment Tribunal’s understanding of the EAT decision in Nicholls v London Borough of Croydon [2018] IRLR 988, and although they entertained doubts about the conclusion in that case, it was not manifestly wrong and so could not be departed from.
Comments