TUPE: Service Provision Change

Mrs Jakowlew was employed by Saga as a care manager and worked mainly on a contract for the London Borough of Enfield (Enfield). Following an incident, Enfield instructed Saga to remove her from the contract; however, Saga did not do so. At the same time, the contract transferred from Enfield to Westminster Homecare Ltd (Westminster). Following the transfer, the employee was dismissed for redundancy. She brought a claim for unfair dismissal, arguing that her employment had transferred to Westminster by reason of a service provision change under TUPE (SPC). The EAT accepted that there had been an SPC and held that the key question was whether, immediately before the transfer, the employee had been assigned to the transferring undertaking. In considering this, the EAT stated that where a third party client instructs an employer to remove an employee from a contract prior to an SPC, it does not follow that the employee immediately ceases to be assigned to the transferring undertaking. It is a matter for the employer whether or not to act on such instruction; here it was clear that at the transfer date, Saga had done nothing to remove Mrs Jakowlew from the contract. As such, she had been assigned to the undertaking immediately before the transfer and her employment had transferred to Westminster.

This case highlights the need for carefully drafted outsourcing agreements, containing a list of employees assigned to the transferring undertaking, as well as appropriate warranties and indemnities.