The EAT has held in Seawell Ltd v Ceva Freight (UK) Ltd and another UKEATS/0034/11 that an employee who spent all of his working time on a single client account was not an organised grouping of employees for the purposes of the service provision change test under TUPE.
Ceva provided logistics and freight forwarding arrangements for clients. Employees were arranged into handling either "inbound" or "outbound" goods. Mr Moffet was part of the outbound grouping and spent all of his time working on the Seawell client account. Although other employees worked on the Seawell account, they spent far less time on the contract and worked on other client accounts. Seawell decided to take the work back in-house and Mr Moffet was dismissed.
The employment tribunal held that Mr Moffet's employment had transferred to Seawell under TUPE. The service provision change provisions of TUPE applied because Mr Moffet himself constituted an organised grouping of employees which had as its principal purpose the carrying out of the activities concerned on behalf of Seawell.
The EAT upheld Seawell's appeal against the employment tribunal's decision. An employee who spent the entire time working on a particular client account would not always be an organised grouping of employees. The EAT held that for there to be an organised grouping of employees, there needed to be some deliberate putting together of a group of employees for the purpose of a client's work. Ceva had only organised its employees into handling "inbound" or "outbound" goods. There was nothing to suggest that Ceva had deliberately put together or organised a team to perform the Seawell contract. This meant that there was no service provision change pursuant to TUPE and Mr Moffet's employment had not transferred to Seawell.
Comment: This case follows recent cases which state that the service provision change provisions under TUPE will only apply if there is a deliberate organisation of employees with respect to a client account. It is not enough for employees to just happen to spend their time working on a client account. The case is also part of a wider body of recent case law which seems to adopt quite a narrow view of when there will be a TUPE transfer pursuant to the service provision change test. Unfortunately, this is creating precisely the lack of certainty and clarity which the service provision change rules were designed to avoid.
http://www.bailii.org/uk/cases/UKEAT/2012/0034_11_1904.html
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