Birmingham City Council v Gaston

For TUPE, the question is whether the employee was assigned to the undertaking or part transferred at the time of transfer. That inquiry is functional and fact-sensitive. The court must consider the employee’s actual work and connection with the transferred operation, both at the relevant time and over the preceding period. A contractual description or nominal job title is not decisive and may give a misleadingly narrow picture. The identity of the employer, including in a secondment situation, does not answer the distinct question of assignment.

Birmingham City Council transferred its housing repairs operations to private companies. Mr Gaston disputed that he had transferred with the undertaking operating under contracts A and B and claimed that the Council had dismissed him.

The Employment Tribunal found that he had remained employed by the Council and had not been assigned to the transferred undertaking. The Employment Appeal Tribunal upheld that decision on 26 January 2004. The Council applied to the Court of Appeal for permission to appeal, raising estoppel, inadequate reasoning and substantive error. The central issue was whether Mr Gaston was assigned to the undertaking transferred to Serviceteam.

1. Application refused. Lord Justice Rix gave the first judgment and Lord Justice Peter Gibson agreed.
2. The correct TUPE test was derived from Arie Botzen v Rotterdamsche Droogdok Maatschappij [1985] ECR 519. The question was whether, at the time of transfer, Mr Gaston was assigned to the undertaking or part of the undertaking transferred.
3. Assignment required a functional investigation of the employee’s work and connection with the undertaking. The court should consider all the relevant circumstances, including the position at the time of transfer and the employee’s work over the preceding period. A nominal contractual role or job title was not a sufficient or singular formal test.
4. The distinction between employment by a seconding organisation and assignment to a transferred undertaking was material. Although a seconded employee remained employed by the organisation which seconded him, that did not determine whether he was assigned to an undertaking for TUPE purposes.
5. Mr Gaston had not performed plumbing work during normal working hours since 1979, had performed no plumbing work at all after 1999, and had worked for more than 20 years as a full-time chief federation steward. His work was not allocated to a particular contract and extended across the housing department and the Council more generally. Those facts supported the conclusion that he was not assigned to contracts A and B. The Employment Appeal Tribunal was entitled to regard that as the only possible conclusion.
6. The estoppel argument also failed. The earlier Employment Tribunal proceedings had not determined whether Mr Gaston should be regarded as a plumber and concerned his entitlement for plumbing work performed out of hours in a different factual context. The application for permission to appeal was therefore refused.

1. Court of Appeal (Civil Division): On 20 May 2004, refused Birmingham City Council’s application for permission to appeal.
2. Employment Appeal Tribunal: On 26 January 2004, upheld the Employment Tribunal’s decision.
3. Employment Tribunal: On 30 September 2002, found that Mr Gaston had remained employed by Birmingham City Council and had not transferred to Serviceteam.