The TUPE Regulations

Regulation 3(1)(b) of TUPE provides employment protection to employees where there is a change of service provision.  It applies where a client contracts out of services, or takes it back in-house, or transfers the service from one provider to another.

Court of Appeal ruling

The Court of Appeal has recently ruled in McCarrick –v- Hunter that Regulation 3(1)(b) will only apply where the client for whom the service is performed remains the same.

Background to the case

The facts of McCarrick –v- Hunter are quite complex.  Mr McCarrick was initially employed by WCP Management Limited to manage commercial properties for Waterbridge Group. Due to financial difficulties, receivers took control of Waterbridge’s properties and appointed King Sturge to take over the property management services.  At this point Mr McCarrick became personally employed by a Mr Hunter, who had been the managing director of Waterbridge Group, to assist King Sturge although the receivers did not pay Mr Hunter for these services.

When Mr McCarrick was dismissed by Mr Hunter, Mr McCarrick brought a claim of unfair dismissal against Mr Hunter and attempted to demonstrate that he had the necessary continuity of service.  In doing so he relied in part on Regulation 3(1)(b) and argued that this should be read purposively to give him protection.

However, the Court of Appeal disagreed that Regulation 3(1)(b) would apply and pointed out that its wording is clear and  that it only applies where the client remains the same.  In this situation the client had changed – while WCP had previously provided services to Waterbridge Group (the first client), this had changed to King Sturge providing services to the receivers (the second client).  Therefore there was no service provision change.  As a result Mr McCarrick did not have the necessary continuity of service to bring a claim of unfair dismissal.