It doesn’t seem so long ago that the concept of an automatic transfer of employees under TUPE evoked exclamations of incredulity and disbelief amongst non-lawyers (and some lawyers). Now we have all got used to the idea, Gabriel v (1) Peninsula Business Services Ltd (2) Taxwise Services Ltd reminds us that unless TUPE applies, employees cannot be transferred without their consent. To paraphrase Lord Atkin in the case establishing this principle (Nokes v Doncaster Amalgamated Collieries Ltd [1940] House of Lords), it is the right of a citizen to “choose for himself whom he would serve”, and this right of choice constitutes the main difference between a “servant and a serf”.
The case came about after Peninsula, where Ms Gabriel worked, bought the shares in a company called Qdos Taxwise Ltd (“Taxwise”) in 2007. Ms Gabriel moved to work in Peninsula’s Taxwise department, continuing to be paid by Peninsula. In due course, Taxwise took over the payroll for that department, but there was no change in her terms and conditions and Peninsula continued as her employer. Finally, in 2009, Taxwise changed its name, and an email was sent to employees in Peninsula’s Taxwise department telling them that Taxwise was taking over Peninsula’s Taxwise business and they were to be transferred. However, Ms Gabriel did not receive that email, and never realised what had happened. She subsequently made race and sex discrimination claims, initially naming only Peninsula as a respondent, and later adding Taxwise.
A tribunal found, at a pre-hearing review, that she had been transferred to Taxwise in 2009, and that it had no jurisdiction to hear a claim against Peninsula, but that she could continue her claim against Taxwise. On appeal against this, the Employment Appeal Tribunal held that as no TUPE transfer had taken place, any transfer of her employment would be covered by the pre-TUPE law of contract, under which it was impossible for an employee to be transferred to another employer without their knowledge or consent. Consequently the claim against Peninsula has been restored. The case against both Pensinsula and Taxwise will now be considered by an employment tribunal.
Think its useful to note that the allege transfer matter actually came to light only as a result of an entry on another employees fit note provided to peninsula in 2010. This was the catalyst upon which peninsula then recalled the allege transfer of Gabriel and pursued this very late prelimnary issue which was quite strangely approximately 8 months after Gabriel raised her grievance as well as her two ET1s with her employer Peninsula business services.