ICTS UK Ltd v Mahdi

When determining a client’s intention under Regulation 3(3)(a)(ii) of the TUPE Regulations, an Employment Tribunal must consider all relevant circumstances. These may include subsequent events, provided they are capable of casting light on the intention at the relevant date. The issue remains the client’s intention, rather than the eventual outcome.

The Tribunal may infer intention even where the party relying on the exception calls no evidence. The burden of proof is a fallback if the Tribunal cannot reach a factual conclusion. An evidential or reasoning error warrants remission where it may have affected the result.

The claimants were security guards employed by ICTS UK Ltd at Trent Park Campus. After AUCMS acquired the site, First Call Secure Group Ltd took over the security services on 11 November 2013.

The Employment Judge found that the activities and client remained substantially the same, but concluded that AUCMS intended the services to relate to a short-term task. Accordingly, no service provision change occurred and the claims remained against ICTS. ICTS appealed, challenging the treatment of subsequent events, the burden of proof and the acceptance of a letter relied upon by First Call.

1. Appeal allowed in part and remitted. The Employment Judge erred in law by stating that he could not look at events after 11 November 2013 and by failing to make findings about planning permission and building work. Subsequent events may be considered where they are capable of casting light on the client’s intention at the relevant date. The Tribunal must keep the ultimate issue focused on intention, not outcome.

2. The relevant intention under Regulation 3(3)(a)(ii) was AUCMS’s intention on 11 November 2013. It concerned the task to be carried out and its intended duration, rather than the activities considered in the abstract. An intention required more than a mere hope or wish, and the issue was one of fact.

3. The Employment Judge was entitled to determine the issue by drawing inferences from the available material, regardless of whether First Call called evidence. This was consistent with the principle that the burden of proof is only material where the Tribunal cannot reach a view on the facts.

4. The perversity ground failed. Acceptance of one document did not require acceptance of every document produced by the same party. It was not obviously wrong to accept the letter of 8 November 2013 and consider it as part of the surrounding circumstances. The parties could nevertheless reopen arguments about its significance on remission.

5. The matter was remitted for a further hearing before the Employment Tribunal, with no further evidence, so that findings could be made from the evidence already presented and the conclusion under Regulation 3(3)(a)(ii) reconsidered.

• Employment Tribunal: Employment Judge Southam concluded on 15 September 2014 that there was no relevant transfer and that liability remained with ICTS.
• Employment Appeal Tribunal: Appeal allowed on the ground concerning subsequent events; the matter was remitted for reconsideration. The burden-of-proof and perversity grounds were rejected.