TUPE Regs allow an employee to claim constructive dismissal if a transfer involves a substantial and detrimental change to their working conditions. Jenny Wotherspoon reports on a recent appeal case focusing on this scenario.
Topic: TUPE
Who: Ms Tapere v South London and Maudsley NHS Trust (the "Trust")
Where: Employment Appeal Tribunal
When: 19 August 2009
Law stated as at: 1 September 2009
What happened:
The Employment Appeal Tribunal ("EAT") considered the operation of Regulation 4 (9) TUPE 2006, which allows an employee to treat themselves as constructively dismissed where a TUPE transfer involves or will involve a substantial change to their working conditions which causes them a material detriment.
The EAT held that whether there is a substantial change in working conditions is a question of fact which is to be determined by reference to the nature as well as the degree of change. However, when assessing whether or not a particular change is to an employee's detriment a subjective approach is required.
Background
Where an employee's employment transfers under TUPE, Regulation 4 (9) TUPE 2006 allows an employee to resign and treat themselves as constructively dismissed where the transfer involves or will involve:
- a substantial change;
- in the employee's working conditions;
- to their material detriment.
Liability for the employee's claim will usually rest with the new service provider.
Facts
Ms Tapere brought such a claim following a transfer of her employment from Lewisham PCT (the "PCT") to the Trust which required a change in her place of work from Camberwell to Beckenham. It was written into her contract that her place of work was the Camberwell site but the contract also contained a "mobility clause" which stated that 'there may be occasions when you are required to perform your duties either temporarily or permanently at other locations within the [PCT]'.
Ms Tapere alleged that this change was substantial and placed her at a detriment in terms of potential disruption to childcare arrangements and a different journey (on the M25) which she did not consider attractive. The Trust maintained that the additional travel time was actually minimal and that they had acted reasonably in agreeing to vary Ms Tapere's start time. The Tribunal dismissed Ms Tapere's claim.
The Employment Tribunal held that Ms Tapere's contract of employment contained a mobility clause which transferred under TUPE so that the Trust could move her within its own geographical location. The Employment Tribunal also concluded that Ms Tapere could not rely upon Regulation 4(9) of TUPE as, viewed objectively, there was not a substantial change to her detriment. Ms Tapere appealed to the EAT.
The EAT held that the Trust was not permitted to rely on the mobility clause in Ms Tapere's contract as this could only be construed as to cover locations belonging to the PCT and not the Trust. The EAT went on to uphold Ms Tapere's constructive dismissal claim and concluded as follows:
- Whether there has been a substantial change to working conditions is a question of fact in each case depending on the nature and degree of the change and it is not necessary to consider whether this should be judged from a subjective or objective perspective.
- On the question of detriment, the EAT held that one should not compare the position taken by the employer and the employee and judge which is the most reasonable (an objective approach) rather the question of detriment should be assessed from the employee's point of view, adopting a subjective approach. The EAT held that the Tribunal ought to consider whether the employee in question regarded the consequences of the change as detrimental and if so, whether that was a reasonable position to adopt. However, the detriment must be more than trivial or fanciful.
Why this matters:
Employers in the marketing and advertising sectors will already be familiar with the prospect that TUPE will apply when client contracts are won or lost. Employers who inherit employees under TUPE often require those employees to change their place of work as a consequence of the transfer. In this scenario, employers need to consider (1) whether the move is permitted under the contracts of employment; and (2) whether the move is likely to cause a material detriment to the employees.
A mobility clause which permits employees to be moved within locations operated by the outgoing contractor is unlikely to allow the new contractor to move the employees to their own sites. However, where there is a general mobility clause this may be permitted within the scope of contract, providing that the new employer implements this change with reasonable notice and with due regard to the impact on the employees.
Irrespective of the contractual terms, employees may still seek to resign and claim constructive dismissal under TUPE if the move is significant and likely to cause them a material detriment. Therefore, employers should tread carefully when proposing changes to working conditions in the context of a TUPE transfer. Employers in this situation will need to carefully assess the employees' perceptions of the change and take legal advice before the changes are finalised.
