Dr Marcul Bicknell & Anor v NHS Nottingham and Nottinghamshire Integrated Commissioning Board

For regulation 3 of the Transfer of Undertakings (Protection of Employment) Regulations 2006, commissioning or purchasing goods or services does not itself constitute an economic activity. Under the binding EAT decision in Nicholls, commissioning is economic only where the commissioner also supplies the goods or services on the market.

An EAT may depart from its earlier decision only within the Lock exceptions. Doubts about the earlier analysis do not suffice: it must be manifestly, or obviously, wrong. Where an entity has been found not to pursue an economic activity, it is unnecessary to decide separately whether the public-administration exclusion applies.

Following an NHS reorganisation, six clinical commissioning groups merged to form a new body. Dr Bicknell’s former employer principally commissioned healthcare services from providers; it did not itself provide those services on a market.

The Employment Tribunal held that there was no relevant transfer under the Transfer of Undertakings (Protection of Employment) Regulations 2006. It therefore dismissed Dr Bicknell’s claims for automatically unfair dismissal and dismissal contrary to regulation 7(2), and the BMA’s claims concerning information and consultation.

The claimants appealed, principally contending that the tribunal had misunderstood Nicholls and FENIN, and that it should have considered public administrative functions and further activities of the commissioning group.

1. Appeal dismissed. The Employment Tribunal correctly understood Nicholls v London Borough of Croydon [2019] ICR 542. Its essential reasoning was that purchasing or commissioning goods or services cannot, by itself, be an economic activity; for commissioning to be part of an economic activity, the commissioner must also supply the relevant goods or services on the market.

2. That proposition was part of the legal framework necessary to the decision in Nicholls, not obiter. The present EAT could therefore allow the appeal on this ground only by departing from that earlier EAT decision.

3. Applying British Gas Trading Ltd v Lock [2016] 2 CMLR 40, departure from an earlier EAT decision requires an established exception, including that the decision was per incuriam, inconsistent with another relevant decision, manifestly wrong, or affected by exceptional circumstances. Nicholls was not per incuriam and no other exception applied. Although the EAT entertained doubts about applying a competition-law analysis to the employment context, the conclusion in Nicholls was not obviously or manifestly wrong.

4. FENIN supported the proposition that purchasing is not an economic activity considered in isolation. Its reasoning could arguably leave open whether purchaser and provider must be the same entity, but it did not make Nicholls manifestly wrong. The Employment Tribunal’s account of parts of FENIN was muddled, but that error did not affect its operative reliance on Nicholls.

5. Once the Employment Tribunal found that the commissioning group was not engaged in an economic activity, there could be no relevant transfer. It did not need also to decide whether regulation 3(5) applied by examining the public-administration factors identified in Nicholls. Its findings that the group’s other functions were ancillary to its statutory commissioning role were sufficient.

• Employment Appeal Tribunal: Appeal dismissed: [2024] EAT 103 .
• Employment Tribunal (Midland East): Decision sent to the parties on 13 August 2022. It held that there was no relevant transfer under the Transfer of Undertakings (Protection of Employment) Regulations 2006 and dismissed the claims.