No, held the EAT in Inex Home Improvements Ltd v Hodgkins & others.
The Claimants worked on a building project in Sandwell, which was split into various tranches, they were laid off as per a national agreement when a tranche was completed. Their employer Inex did not get a further tranche of work, which went to another contractor in circumstances that the employment tribunal found would have been a service provision change, but since the Claimants were laid-off, they weren't an 'organised grouping' and so didn't transfer.
The EAT rejected this approach, taking a purposive approach to TUPE over a service provision change, for the 'protection of employment' despite those regulations deriving from UK law not EU law, and noted that:
"Common sense suggests that a temporary cessation of employment including for the purpose of holidays, sickness, or expressed to be a temporary lay off should not of themselves deprive employees of their employment if there is a service provision change during the period of temporary cessation."; but noting "In our opinion a temporary cessation of work in the case of a service provision change immediately prior to the transfer does not necessarily prevent a TUPE transfer taking place. The purpose, nature and length of the cessation are of course relevant in determining whether or not the organised grouping continued in existence.".