Seawell Ltd v Ceva Freight (UK) Ltd and Moffat UKEAT(S)/0034/11/BT (2012) EMPLR 143
Service provision change
19 April 2012
Employment Appeal Tribunal
The fact that a person spends 100% of their time providing services for one client does not mean that, when the client appoints a different provider, there is necessarily a ‘service provision change' under TUPE. As this case illustrates, for there to be a ‘service provision change' that employee must be part of an organized grouping of employees whose principal purpose is providing those services.
Ceva provided storage and shipping services to Seawell, a supplier to offshore oil platforms. Ceva employed Mr M for 100% of his time on the Seawell contract. Others also worked on the contract, including warehouse operators, but the percentages of their time spent on the Seawell contract were between 10% and 20% each (about 90% in total) .
Seawell took the services in house. Ceva claimed this was a service provision change under TUPE, so that his employment transferred to Seawell.
The EAT disagreed. For there to be a service provision change, there must be:
- an organised grouping of employees;
- whose principal purpose is to carry out activities on behalf of the client;
- after the change those activities are to be carried out by the transferee (in this case, Seawell).
Ceva argued that Mr M constituted the organized grouping of employees. But the EAT held that the storage and shipping activities were carried out not just by Mr M but also by other employees of Ceva. The principal purpose of that grouping as a whole was not just the Seawell contract. The definition of ‘service provision change' was not therefore satisfied. TUPE did not therefore transfer Mr M to Seawell and Mr M was therefore dismissed by Ceva.
To view the case transcript, you must subscribe to Jordans Employment Law Online (if you already subscribe click here to log in).
To request a free trial click here and select Jordans Employment Law online from the drop down menu
Jordan Publishing Employment Law Series
Examines how employment documents can be used to help manage home and host country immigration,...