Changing contractual term post-TUPE transfer
25 October 2018
The Employment Appeal Tribunal (EAT) has considered whether the removal of a contractual allowance was connected with a TUPE transfer.
Tabberer and others v Mears Ltd and others, UKEAT/0064/17
The claimants were a group of electricians, previously employed by Bristol City Council. They had a contractual entitlement to be paid Electricians’ Travel Time Allowance (ETTA), an entitlement that had been in existence since 1958. The electricians had been subject to a number of TUPE transfers and had retained the right to receive the ETTA.
Following a further TUPE transfer to Mears in 2008, the payment was stopped on the basis that the eligibility criteria was no longer satisfied. A group of the electricians subsequently succeeded in a claim for unauthorised deductions from wages. Mears then gave notice to the employees that it was ending ETTA with effect from September 2012.
The employees brought a further claim, arguing that the variation of the terms of their employment was void under TUPE. At the relevant time, the 2006 TUPE regulations prevented changes to an employee’s terms if the change was for a reason connected with the transfer which was not an economic, technical or organisational (ETO) reason entailing changes to the workforce. An employment tribunal rejected the claim on the basis that the reason for the change was not the TUPE transfer but because the ETTA was an outdated and unjustified allowance, in respect of which the majority of the employees no longer met the criteria.
The EAT has rejected the employees’ appeal and agreed with the tribunal’s conclusion that the reason for the change in terms was not connected with the transfer. The main reasoning behind the decision to remove the ETTA, namely the belief that the payment was outdated and unjustified, was a pre-existing belief and did not arise purely because of the transfer.
The 2006 TUPE regulations were amended in 2014, meaning that post-transfer changes are only void if the sole or principal reason for the change is the transfer, not if the change is for a reason connected with the transfer (as used to be the case under the 2006 Regulations). However, this decision is still likely to be applicable to employers as an example of the type of scenario when a post-transfer amendment to terms and conditions will not be found to be void.
This article is from the October 2018 issue of Employment Law Update, our monthly newsletter on employment legislation and regulation. To download the latest issue, please visit the newsletter section of our website. Law covered as at October 2018.
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The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at October 2018.