TUPE: Change in Identity of Employer

Thanks to Ed McFarlane of Deminos HR for preparing this case summary

Is there a transfer of an undertaking when an employee changes from being employed by a single employer to a group of employers which includes the original employer?

No, held the EAT in Hyde Housing Association v Layton, upholding the employers' appeal, there was no transfer of the Claimant's employment on the facts. The EAT also noted that multiple transferors would not prevent TUPE applying.

The Claimant had been employed by Martlet, a provider of social housing, which joined with other providers to form the Hyde Group, which was not a separate legal entity. After a restructure the Claimant was dismissed by Martlet and re-engaged on a new contract by a group of employers including Martlet, an arrangement reportedly common in the sector.

The Claimant claimed unfair dismissal, the issue was whether his employment transferred under TUPE regulation 3 (1) (a). The EAT held that since Martlet had retained liability for the Claimant's employment notwithstanding that its liability was now joint and several with other employers, the change of employer was not legally relevant for TUPE purposes. The EAT also held that the Acquired Rights Directive did not require TUPE to apply, as the employer's legal position with regards to the employee was unchanged (as with a change of shareholders). Noting the potential importance and novelty of the issue, the Claimant received leave to appeal.