The claimant in Ottimo Property Services Ltd v Duncan was a site maintenance manager for Ottimo, based at a residential village. Ottimo serviced a number of housing blocks at the village, all of which were separate legal entities and had entered into separate contracts with the company which had sub-contracted the work to Ottimo. Another company, Warwick, then acquired the contracts to provide the work for most of the sites. The claimant was dismissed by Ottimo.
The Tribunal decided that it was not possible for a number of contracts with different clients to be added together to make one overall service provision change (SPC). The claimant's employment did not transfer to Warwick under TUPE and so any liability for his claims remained with Ottimo.
The two essential conditions for an SPC are:
- An organised grouping of employees whose principal purpose is the carrying out of activities for "the client"
- "The client" intends the activities to be carried out by the transferee after the SPC.
There have been plenty of cases illustrating the need for the identity of the client before and after to remain the same; the novel question here was simply – can "the client" include "the clients"?
The EAT's answer was yes. There was no reason in principle why "the client" must be a single legal entity; as long as the identity of the clients remains the same before and after the SPC it could involve more than one legal entity, although it would still need to be possible to find a common intent amongst the clients for the purposes of the second condition. Clearly this would be easier where they had entered into some sort of umbrella contract together but the absence of one single contract would not necessarily be fatal to the finding of a common link between the clients. On this basis, the EAT sent the case back to the tribunal to decide if there had in fact been an SPC.