In Dewhurst v Revisecatch Ltd t/a Ecourier and City Sprint (UK) Limited ET2201909/18, the London Central Employment Tribunal has held for the first time that workers qualify for protection under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).
The Tribunal found that that workers falling within the definition in section 230(3)(b) of the Employment Rights Act 1996 (known as “limb (b) workers”) are protected under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006).
Regulation 2(1) of TUPE 2006 defines “employee” as any individual working under a contract of service or apprenticeship “or otherwise”, but excludes the genuinely self-employed.
The Acquired Rights Directive (2001/23/EC) (ARD), defines an employee as “any person who, in the Member State concerned, is protected as an employee under national law”. Article 3.2 goes on to provide for the transfer of rights and obligations arising from an employment contract or “employment relationship”.
Domestic legislation uses the term “employee” to describe both traditional employees and individuals in an intermediate class who benefit from some employment rights. In particular, section 83(2)(a) of the Equality Act 2010 (EqA 2010) includes within the “employee” definition anyone working under a “contract personally to do work”. The tribunal therefore held that “employment relationship” under the ARD must be read as including such individuals.
Joffe EJ held that this was not just a semantics issue. If “employment relationship” did not encompass workers, the ARD would not operate to transfer liability for discrimination against a worker from an insolvent transferor to a transferee. It cannot be in accordance with the ARD, or discrimination law, for workers to be entitled to discrimination protection but not to be entitled to preserve liability for infringement of those rights against a transferee.
Regulation 2(1) of TUPE 2006 was intended to confer rights on a broader class than just those employed under an employment contract, due to the wording “or otherwise”. The tribunal was required to interpret regulation 2(1) in accordance with the ARD and the words “or otherwise” had to be construed so as to include limb (b) workers. To do otherwise would be absurd; if an individual qualifies as an “employee” under the EqA 2010, then they must also be “protected as an employee under national law” under Article 2(1)(d) of the ARD.
The case is likely to be appealed and is not binding in other cases. Employers are likely to wish to wait for appellate confirmation before changing their practices on the transfer of an undertaking. Even if the decision is upheld, workers are still not employees so would not be in a position to make unfair dismissal claims.