CT operated a subsidised park-and-ride bus service under a contract with the Council. The timetable and buses used were controlled by the Council. A private company, Stagecoach, decided to run its own unsubsidised service on the same route – the rules about running public transport entitled Stagecoach to do this once it had given notice. The Council was not allowed to run a subsidised service in competition with a commercial service and so it terminated its contract with CT on 28 September. Stagecoach's service began operating the next day.
When Stagecoach declined to take on CT's drivers, the Tribunal had to decide whether there had been a TUPE service provision change. It found that, prior to 29 September, the service was carried out by CT on the Council's behalf; and that the same activities were then carried out by Stagecoach but, crucially, not "on the client's behalf" as required by TUPE. Although the Council was an "interested bystander" and derived a benefit from a successful service, Stagecoach was running the route as its own commercial venture.
The EAT agreed. Some specific features of the arrangements supported the Tribunal's "common-sense and pragmatic" view that the client had not remained the same:
- Stagecoach provided its own buses, paid a fee for use of the facilities at the car park and received no subsidy from the Council.
- Although it did liaise with the Council about the service before and during its operation, Stagecoach had reduced the frequency of the service, despite the Council's misgivings