The Employment Appeal Tribunal (EAT) has ruled that, for the purposes of Regulation 13 of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE), the ‘affected employees’ whose representatives an employer must inform and consult regarding a relevant transfer are those who will or may be transferred, those whose jobs are at risk on account of the proposed transfer and those who have internal job applications pending at the time of the transfer. The definition does not extend to everyone in the workforce who might apply in the future for a vacancy in the part of the undertaking being transferred (Unison v Somerset County Council and Others).
The issue arose because Somerset County Council and Taunton Deane Borough Council decided to transfer the bulk of the work of their Resources Directorates to a new, joint venture company, South West One Ltd., which would be controlled and run by IBM. There had been lengthy and, in the EAT’s view, ‘exemplary’ consultation over a period of two years prior to the transfer and 846 employees were given the choice of either transferring under TUPE to the new company or of being seconded to it but remaining as Council employees.
All but one opted to remain as Council employees. However, aspects of the staffing agreement relating to future recruitment to the new company remained contentious right up until the deadline set for agreement with IBM. Unison was concerned that a policy, whereby jobs that could not be filled from within the new company were then advertised externally at the same time as they were offered to other Council employees not involved in the transfer, could result in the gradual privatisation of the workforce of South West One. In the event, changes were made to the earlier proposal and agreement to this effect was reached, but without full consultation.
Unison claimed that there had been a failure to consult employee representatives in accordance with TUPE Regulation 13. However, the Employment Tribunal (ET) found that the speed of events and the rapidly approaching deadline were special circumstances (TUPE Regulation 13.9) so that it was not reasonably practicable for consultation to take place.
Unison appealed against this decision and lost. The EAT held that the ET was entitled to reach the conclusion that the special circumstances defence had been established.
The EAT then looked at what is meant by affected employees. Firstly, there was no reason to consult with employees who it was agreed had transferred under TUPE as regards the new staffing agreement as their position remained unchanged. Vacancies would first be offered to those employed in the new company. Unison claimed, however, that other Council employees fell under the definition of affected employees and should have been consulted because the staffing agreement reached impacted on their future job prospects.
The EAT could not accept this interpretation as it would lead to the conclusion in many, if not most, cases that every employee of the organisation is potentially an affected employee.
