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February 2012 Updates

TUPE transfers - need for an organised grouping of employees

In Eddie Stobart Ltd v Morman, the Employment Appeal Tribunal confirmed that employees will not transfer to a new service provider under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) if there is no evidence of an organised grouping of employees.

Assuming that there is such a group, the company must identify the employees within it who are assigned to the work which is transferring. A good example of an organised grouping of employees would exist where there is a particular client "team" which is dedicated to a particular client.

In this case, Eddie Stobart had 35 employees at one site in Nottinghamshire. The employees serviced at least five clients. The contracts were reduced to two. Eddie Stobart decided that all employees who worked for more than 50% of their time on the contracts should transfer to the new service provider.

However, the employees were organised in respect of their shifts but not in relation to a particular customer. This meant that there was no organised grouping of employees and, therefore, no TUPE transfer.

Fraudulent/illegal contracts

In Zarkasi v Anandita, the Employment Appeal Tribunal reaffirmed that a worker can't enforce any employment rights arising under a contract of employment if their contract was illegal from the outset.

In this case, the Claimant was an Indonesian domestic worker recruited from Indonesia to work for a family in the UK. To enter the UK, she used a false identity to obtain an identity card, passport and visa from a passport office in Jakarta. She later left her employer in the UK and brought a number of employment claims which were dependent upon her having had a contract of employment.

The Employment Tribunal found that the Claimant had voluntarily participated in a fraudulent process in order to enter the UK. That made the contract unlawful. As such, it was unenforceable, as were any statutory rights associated with it.

The Claimant then asserted that she had been the victim of human trafficking and that the Tribunal should, in the spirit of the European Convention on Action against Trafficking in Human Beings, provide her with a remedy to her claims. The Tribunal rejected this as it had no jurisdiction or powers in that regard.

The Employment Appeal Tribunal agreed with the Tribunal on both points and the appeal failed.


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SRA number 404293