Exceptions to TUPE Regulations: Task of Short-Term Duration

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The law surrounding the application of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE Regulations) is often fairly complicated. It is therefore useful when the courts try to provide some helpful guidance.

 

In the recent case of Swanbridge Hire and Sales Limited v Butler and others, the Employment Appeal Tribunal (EAT) sought to clarify the meaning of the “single specific event or task of short term duration” exception to the rules surrounding TUPE transfers involving a service provision change.

Kitson Environment Europe had a contract with Shaw Group Limited to install insulation and cladding on five power station boilers. Kitsons were replaced by Swanbridge part way through the contract and Swanbridge finished the work. The Employment Tribunal was asked to decide whether this was a service provision change under the TUPE Regulations.

There would not be a service provision change under Regulation 3(3)(a)(ii) of the TUPE Regulations if the company (Shaw Group Limited) intended that the activities following the change were to be carried out in connection with a single specific event or a task of short-term duration.

The Tribunal held that the insulation contract was not a “single specific event or task of short-term duration” as the contract was lengthy and protracted. It took 18 months to complete and Swanbridge was responsible for the contract for eight of those months. The Tribunal therefore decided that there was a service provision change and the TUPE Regulations applied.

The company appealed against this decision and the EAT allowed the appeal. They found that the Judge failed to consider the intention of Shaw Group Limited at the time of the alleged service provision change as the exception would only apply where it is the company’s (Shaw Group Limited’s) intention to contract for a single specific event or task of short term duration. The Tribunal had failed to consider this point.

The EAT also found that the Tribunal had erred in deciding whether the “event” although referred to by the EAT as a “task” of insulating and cladding the boilers was short-term by reference to the the length of time it took both of the contractors to carry out the work.

Finally the EAT also expressed a view on the opposing views held by Langstaff J in SNR Denton UK v Kirwan and Lady Smith in Liddell’s Coaches v Cook as to whether “of short-term duration” qualifies “event” as well as “task” and whether these terms would apply in the same way. The EAT preferred the latter opinion of Langstaff J that “of short-term duration” qualifies “event” as well as “task”.

After providing the above guidance the EAT referred this case to a different Employment Tribunal Judge to reconsider where the EAT’s guidance could be applied.

This case provides some useful clarification on the application of this exception to the rules surrounding a service provision change. This exception may also be useful for companies to be aware of if they are contemplating a service provision change in similar circumstances. However, in my experience the exception is not generally applied very often.

If you have been dismissed by your employer and you believe that your employment should have been transferred to another company or you have been dismissed for any other reason and you consider it to have been unfair and you are looking for a solicitor specialising in TUPE and unfair dismissal in Leeds, please contact the dedicated employment department at Oakwood Solicitors and we will be happy to discuss your situation with you.