17 May 2012

Servant or serf?

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,  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 their name, and an email was sent to employees in Peninsula's Taxwise department telling them that Taxwise were 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 against Taxwise. On appeal against this, the EAT 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. The case against both Pensinsula and Taxwise will now be considered by an employment tribunal.