An EAT decision has set some limits on how widely an employer needs to consult in a TUPE situation. The case concerned two local authorities in the South West who wished to transfer the work of their respective resources directorates to a new company managed by IBN. Following "exemplary" consultation over two years, an agreement was reached under which all the employees who were working in the operations to be transferred would be seconded to the new company, but would remain council employees. If any vacancies arose in the new company they would be advertised to this group of employees first.
In last minute negotiations, a concession was made to IBN about the second stage of the recruitment process to fill new vacancies, which was less favourable to employees who were not transferring. There had been insufficient time to consult about this concession before the deadline for implementing the arrangements and the Union brought proceedings for a breach of the TUPE regulations. The EAT said there was no duty to consult the employees who might lose out as a result of this last minute concession, as they were not "affected employees". In this scenario there was only a duty to consult those who might be transferred, those whose jobs might be in jeopardy as a result of the transfer, and those who had internal job applications pending at the time. There was no obligation to consult council employees who might have an interest in working in the transferred departments at some time in the future.