An account manager working for PR company, Storm Communications Ltd, had transferred to competing PR company, Wild Card, when Wild Card won the account on which she spent around 70% of her time, according to a recent tribunal. This is the first tribunal decision on the service provision change provisions in TUPE 2006 (s.3(1)(b)) applied to professional services. It is particularly interesting as the tribunal considered that the facts fell outside the original business transfer provisions (now in reg 3(1)(a) TUPE 2006).
The case suggests that there is a low threshold for establishing a service provision change. An organised grouping of employees (which may comprise, as in this case, a single employee) dedicated to carrying out activities on behalf of the client will be covered where the activity is outsourced, taken in-house or transferred from one contractor to another. Except where a person objects to being transferred, TUPE will operate to transfer the employment of any person assigned to the organised grouping whose employment would otherwise be terminated by the transfer.
Incidentally, the government considered (but decided against) excluding professional services from the scope of the service provision change provisions. Accordingly, even where a client disposes of the services of a professional services provider specifically because of the people working on its contract, those same people may transfer over to the new service provider. (Hunt v (1) Storm Communications Ltd (2) Wild Card Public Relations Ltd (3) Brown Brothers Wine (Europe) Ltd).